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Under our usual assumptions (state what these are) consider a sealed-bid all-pay auction in which every buyer submits a non-negative bid, the highest bidder receives the good, and every buyer pays the seller the amount of his bid regardless of whether he wins. For simplicity assume [x,x]=[0,1]. Use the expression for bidder equilibrium utility from the Revenue Equivalence Theorem 1 to derive a (symmetric) equilibrium bidding function for the all pay auction. Justify your answer carefully. Is the seller better or worse off using an all pay auction than a second price auction under your stated assumptions? What about bidders? Under our usual assumptions (state what these are) consider a sealed-bid all-pay auction in which every buyer submits a non-negative bid, the highest bidder receives the good, and every buyer pays the seller the amount of his bid regardless of whether he wins. For simplicity assume [x,x]=[0,1]. Use the expression for bidder equilibrium utility from the Revenue Equivalence Theorem 1 to derive a (symmetric) equilibrium bidding function for the all pay auction. Justify your answer carefully. Is the seller better or worse off using an all pay auction than a second price auction under your stated assumptions? What about bidders

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