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An auction with positive externality and possible application to overtime rules in football,soccer, and chess
Authors:Daniel Granot  Yigal Gerchak
Institution:1. Sauder School of Business, University of British Columbia, Vancouver, B.C., Canada;2. Department of Industrial Engineering, Tel Aviv University, Tel Aviv, Israel
Abstract:We analyze auctions with positive externality, wherein the utility of each player who submitted a losing bid is strictly increasing in the price paid by the winning bidder. Such an auction was recently proposed for determining the starting team and the starting yard line in an overtime period in American football. We analyze the NFL case and also consider other football leagues, as well as tie-breaking by penalty shots in soccer, and overcoming a draw situation in chess.
Keywords:First-price auction  Second-price auction  Truthful bidding  Football  Soccer  Chess
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