Information Aggregation in Auctions with an Unknown Number of Bidders

Information aggregation, a key concern for uniform-price, common-value auctionswith many bidders, has been characterized in models where bidders know exactly how many rivals they face. A model allowing for uncertainty over the number of bidders isessential for capturing a critical condition for information to aggregate: as the numbersof winning and losing bidders grow large, information aggregates if and only ifuncertainty about the fraction of winning bidders vanishes. It is possible for the sellerto impart this information by precommitting to a specified fraction of winning bidders,via a proportional selling policy. Intuitively, this makes the proportion of winners known, and thus provides all the information that bidders need to make winners curse corrections.