Early information in auctions with entry
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- Working papers (SNF) 
Consider an auction in which potential bidders must sink an entry investment before learning their values, but where the auction designer can release information so that the bidders learn their values before entry. Such early information will induce screening of high-value bidders, and it will give rise to information rents and thereby a difference between the socially optimal auction and the auctioneer's preferred mechanism. Therefor, the auction designer has too weak incentives to produce early information. Early information may increase or reduce equilibrium entry. If entry is sufficiently reduced, early information will harm the auction designer.