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On the Incidence of Commissions in Auction Markets

Peer Reviewed Article
Victor Ginsburgh, Patrick Legros, Nicholas Sahuguet
International Journal of Industrial Organization, Volume 28, Issue 6, November 2010, 639-644http://www.sciencedirect.com/science/article/pii/S0167718710000329

We analyze the welfare consequences of an increase in the commissions charged by inter- mediaries in auction markets. Commissions are similar to taxes imposed on buyers and sellers, and standard economics suggests that both sellers and buyers are made worse off by the tax. However, we show that when the buyers’ participation constraint binds and when sellers set optimal reservation prices, the level of commissions correlates participation and reservation prices in such a way that participating buyers strictly gain from higher commissions.

 

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Auction House Settlements - Winning Twice?

Newspaper Article
Orley Ashenfelter, Victor Ginsburgh, Kathryn Grady, Patrick Legros, Nicholas Sahuguet
The Art Newspaper, N° 141, November 2003

Efficient and Nearly Efficient Partnerships

Peer Reviewed Article
Patrick Legros, Steven Matthews
The Review of Economic Studies, Volume 60, Issue 3, July 1993, 599-611

This paper shows in two ways that the degree to which free-riding diminishes the performance of deterministic partnerships may be less than has been generally thought. First, a necessary and sufficient condition is provided for a partnership to sustain full efficiency. It implies that many non-trivial partnerships sustain efficiency, such as generic ones with finite action spaces, and neoclassical ones with Leontief technologies. Second, approximate efficiency is shown to be achievable in a large class of partnerships, including ones with smooth and monotonic production and disutility functions. Approximate efficiency is achieved by mixed-strategy equilibria: one partner takes, with small probability, an inefficient action. The degree to which efficiency is approximated is restricted only by the amount of liability the partners can bear. Nonetheless, their equilibrium payments are not arbitrarily large.

 

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Efficiency in Partnerships

Peer Reviewed Article
Patrick Legros, Hitoshi Matsushima
Journal of Economic Theory, Volume 55, Issue , December 1991, 296-322

We provide the necessary and sufficient condition for a partnership to be able to sustain efficiency when the output is stochastic. When limited liability is imposed, we show that only the level of the average liability of the partnership is important; the individual levels of liability are irrelevant. However, the allocation of the total liability among the partners is crucial when additional conditions such as neutrality or individual rationality are imposed.

 

 

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Disadvantageous Syndicates and Stable Cartels: the Case of the Nucleolus

Peer Reviewed Article
Patrick Legros
Journal of Economic Theory, Volume 42, Issue , 1987, 30-49

This paper considers a bilateral market with two complementary commodities and gives a rationale for Aumann’s paradox. The relationship between the notion of strong stability of a syndicate, i.e., the property that no group of players wants to exit or to enter the syndicate, and the notion of disadvantageous syndicates is summarized in two results. If the two sides of the market are balanced in terms of endowments, every syndicate is strongly stable. If the two sides of the market are not balanced in terms of endowments, then being advantageous, in Aumann’s definition, is necessary and sufficient for a syndicate to be strongly stable.

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Computation of the Nucleolus of Some Bilateral Market Games

Peer Reviewed Article
Patrick Legros
International Journal of Game Theory, Volume 16, Issue 1, 1987, 1-14

(Lead article)

 

This paper gives a simple algorithm for computing the nucleolus of bilateral markets with two complementary commodities.

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Allocating Joint Costs by Means of the Nucleolus

Peer Reviewed Article
Patrick Legros
International Journal of Game Theory, Volume 15, Issue 2 , 1986, 109-119

This paper presents a sufficient condition for the nucleolus to coincide with the SCRB method vector and for nonemptiness of the core. It also studies the reasonableness and the monotonicity of the nucleolus under this condition. Finally it analyses the class of games satisfying the condition and compares it with the classes of convex games, subconvex games and the classQ of Driessen and Tijs.

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