Nonstandard bidder behavior in real-world auctions
Empirical work on auctions has found that bidders deviate from standard behavior in important ways. We investigate a range of these behaviors, including nonrational herding, auction fever, quasi-endowment effect, and escalation of commitment. Our innovations are to more completely control for unobse...
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| Veröffentlicht in: | European economic review 2016-04, Vol.83, p.198-212 |
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| container_title | European economic review |
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| creator | Podwol, Joseph Uri Schneider, Henry S. |
| description | Empirical work on auctions has found that bidders deviate from standard behavior in important ways. We investigate a range of these behaviors, including nonrational herding, auction fever, quasi-endowment effect, and escalation of commitment. Our innovations are to more completely control for unobservables by using new data from a field experiment on eBay, and by accounting for censoring of bids below the starting price. Consistent with standard auction theory and in contrast to the predictions of the nonstandard behaviors, we find that auction starting price has no effect on bidder willingness to pay in a private-values setting. We conclude that there is little evidence that these nonstandard behaviors are important in the field. |
| doi_str_mv | 10.1016/j.euroecorev.2015.12.012 |
| format | Article |
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| fulltext | fulltext |
| identifier | ISSN: 0014-2921 |
| ispartof | European economic review, 2016-04, Vol.83, p.198-212 |
| issn | 0014-2921 1873-572X |
| language | eng |
| recordid | cdi_proquest_miscellaneous_1811844825 |
| source | Elsevier ScienceDirect Journals |
| subjects | Auctions Behavior Bidders Bidding Economic theory Electronic commerce Experiment Nonstandard behavior Studies Willingness to pay |
| title | Nonstandard bidder behavior in real-world auctions |
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