Bayes-Nash Equilibrium and Game Theory in Public Expenditure Management

Bayes-Nash Equilibrium and Game Theory in Public Expenditure Management

Auctions purchases represent an effective mechanism for public authorities, designed to provide the buyer (public authority), products and services with a convenient time to complete the transaction and the option to set a minimum price. In this paper we will study the problem of the optimal public...

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Bibliographic Details
Main Authors: Petru FILIP, Marcel Ioan BOLOŞ, Cristian Ioan OTGON
Format: Article
Language:English
Published: General Association of Economists from Romania 2011-05-01
Series:Theoretical and Applied Economics
Subjects:
auction
Bayes-Nash equilibrium
optimization
public authorities
public expenditure
Online Access: http://store.ectap.ro/articole/591.pdf
Description
Summary:Auctions purchases represent an effective mechanism for public authorities, designed to provide the buyer (public authority), products and services with a convenient time to complete the transaction and the option to set a minimum price. In this paper we will study the problem of the optimal public expenditure rules using Bayes-Nash equilibrium in an symmetrical auction with knowledge of independent value, meaning each bidder knows only his own information. After setting the function for optimum balance to profit for the bidders by minimizing this function (the derivation of I order) and maximize it (the derivation of II order), it has to identify the optimal range where the offer of a bidder for products and services will stand.
ISSN:1841-8678
1844-0029

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