Under standard conditions, very different auction formats yield the same expected revenue, so format matters only where those conditions fail.
Vickrey's 1961 result, generalised by Myerson and independently by Riley and Samuelson in 1981. It is why auction design focuses on conditions rather than format: risk aversion, correlated values or collusion each break the equivalence and change which format is better.
In practice
- A charity that switches from a silent auction to an open one raises about the same, and is surprised.
- A procurement that runs a sealed bid and one that runs an open auction get the same price only where the bidders are symmetric and independent, which they rarely are.
- Further reading
- Wikipedia
- Subject
- Games & Strategic Interaction
- Essay
- What is provable, and what people actually do