Chapter Outline

Headline: Firm Chickens-Out in the FCC Spectrum Auction

1. Introduction
2. The Mean and the Variance
3. Uncertainty and Consumer Behavior
   1. Risk Aversion
      1. Managerial Decision with Risk-Averse Consumers
         1. Product Quality
         2. Chain Stores
         3. Insurance
   2. Consumer Search
4. Uncertainty and the Firm
   1. Risk Aversion
   2. Producer Search
   3. Profit-Maximization
5. Uncertainty and the Market
   1. Asymmetric Information
      1. Adverse Selection
      2. Moral Hazard
   2. Signaling and Screening
6. Auctions
   1. Types of Auctions
      1. English Auction
      2. First-Price, Sealed-Bid Auction
      3. Second-Price, Sealed-Bid Auction
      4. Dutch Auction
   2. Information Structures
      1. Independent Private Values
      2. Correlated Value Estimates
   3. Optimal Bidding Strategies for Risk-Neutral Bidders
      1. Strategies for Independent Private Value Auctions
      2. Strategies for Correlated Values Auctions
   4. Expected Revenues in Alternative Types of Auctions
7. Answering the Headline
8. Summary
9. Key Terms and Concepts
10. Conceptual and Computational Questions
11. Problems and Applications
12. Selected Readings