Auction fever: Rising revenue in second-price auction formats

• 成果类型: Article
• 署名作者: Ehrhart, Karl-Martin; Ott, Marion; Abele, Susanne
• 署名单位: Helmholtz Association; Karlsruhe Institute of Technology; University System of Ohio; Miami University
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2015.06.006
• 发表日期: 2015
• 页码: 206-227
• 关键词: Auction fever; experiment; Private uncertain values; Pseudo-endowment effect

摘要

The prevalent term auction fever visualizes that ascending auctions - inconsistent with theory - are likely to provoke higher bids than one-shot auctions. To explore and isolate causes of auction fever experimentally, we design four different strategy-proof auction formats and order these according to expected rising bids based on pseudo-endowment effect arguments (psychological ownership and disparity between willingness to pay and willingness to accept). Observed revenues in the experiment in the four formats rank as expected if bidders have private uncertain values (the private information of a bidder is the distribution of her value). A control treatment supports our view that the traditional private certain values approach prevents auction fever in the laboratory. Another control treatment with a procurement auction relates the auction fever bids to bids in a one-shot auction with real endowments. We conclude that, when bidders are uncertain about their valuations, auctions that foster pseudo-endowment may raise bids and revenues. (C) 2015 Elsevier Inc. All rights reserved.