Revenue comparison for two uniform private values

ID: revenue-comparison-for-two-uniform-private-values

For two independent uniform valuations on , optimal posted price revenue is , attained at . An English auction without reserve earns the expected minimum, . With reserve , revenue is plus the expected smaller valuation when both exceed , namely . It is maximized at , giving . Different reserve-dependent allocation probabilities explain why this differs from the no-reserve revenue without violating revenue equivalence.

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