However, as economists, there is a need that costs of factors of production be compensated in the amounts of revenues collected. This is the reason for making this topic an area of relevance to the economists.According to Mike (93), open bids give a chance for the bidders to get valuable information from the market as it concerns the valuations. The accessed information helps to enhance effective assignment of licenses basing on its ability to let the bidders place their bids after scrutinizing the available data. Another possible advantage of open bidding is the ability to consider the rights of the bidders. In such a case, the bidders have a chance to make highly aggressive bids relating to the comprehension of relevant terms applicable to licenses.An evaluation of sealed bidding model reveals that in certain instance, bidders may collude in the process. If the bidders were to collude, then they would have a chance of influencing the bidding process, as it happens in the open bidding models. An open bidding process gives more chances for the bidders who do not abide by the collusive agreements to lose on a punitive measure. The highest bidder in the single sealed bidding model is the ultimate winner of the bidding process. This differs from the open bidding, where the winner should give an offer that is some amount higher than the second highest bidders (Mike 103).Sequential bidders do not get all the relevant information regarding the licenses in the market, therefore, they do not make respond to the information relevantly. The bidders need to keep guessing the next prices at the time they submit their current offers. There is a danger of miss-guessing the prices because such an activity may deter the process of license assignment if it happens that they were interdependent (Mike, 116). Sequential bidders do not have a chance of revisiting the previous licenses if they find that the prices of the current bids are higher than the initial ones. Such situations result in bidders regretting not having bought the licenses while the prices were lower than the current ones. Therefore, the tactics employed in sequential bidding are complicated, which means the efficiency of a sequential bid is low.Simultaneous bidders have a chance to make offers for a collection of interrelated licenses at a single time. The
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