There's more than one way to sell a security: the Treasury's auction experiment

Salomon Brothers Inc.'s admission in Aug. 1991 that it had seriously violated auction rules in 1990 and 1991 damaged the credibility of Treasury securities auction rules. This led the Treasury Dept. to experiment with the use of the uniform-price auction in lieu of the discriminatory-price auction. Analyses of the results of uniform-price auctions in the US and in other countries have yielded inconclusive results. However, the results also warrant the continuation of experiments with the uniform-price auction format to gather more data.