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|Title:||Lottery or waiting-line auction?||Authors:||Taylor, G.A.
|Issue Date:||2003||Citation:||Taylor, G.A., Tsui, K.K.K., Zhu, L. (2003). Lottery or waiting-line auction?. Journal of Public Economics 87 (5-6) : 1313-1334. ScholarBank@NUS Repository. https://doi.org/10.1016/S0047-2727(01)00196-7||Abstract:||This paper studies the efficiencies of the two most widely used non-price allocation mechanisms: lotteries and waiting-line auctions. As our analysis suggests, in addition to the fairness of the mechanism, the use of lotteries in lieu of waiting-line auctions can be also justified from an efficiency point of view. In particular, we show that the less dispersed consumers' time valuations are, the more efficient is a lottery relative to a waiting-line auction. In addition, we identify four conditions under which a lottery dominates a waiting-line auction in expected social surplus preserving. Furthermore, the numerical simulations we conduct indicate that over a predominantly wide range of circumstances, a lottery is more socially efficient than a waiting-line auction as an allocative mechanism in the absence of a conventional price system. © 2002 Elsevier Science B.V. All rights reserved.||Source Title:||Journal of Public Economics||URI:||http://scholarbank.nus.edu.sg/handle/10635/22398||ISSN:||00472727||DOI:||10.1016/S0047-2727(01)00196-7|
|Appears in Collections:||Staff Publications|
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