Bidding behavior in sequential cattle auctions
AbstractThis paper studies the institutional characteristics of sequential cattle auctions and their effects on prices. It examines the effects of the order of sale according to quality, secret reserve prices, bidders' multi-unit demands and certain characteristics of the bidders. Theory predicts declining prices when sellers are allowed to reject the outcome of the auction, and increasing prices when bidders demand more than one unit. I find evidence that observed declining prices are caused by the order of sale according to quality and the secret reserve prices. I also find that bidders consider the strategic effect of sequential auctions and multi-unit demand.
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Bibliographic InfoArticle provided by Elsevier in its journal International Journal of Industrial Organization.
Volume (Year): 27 (2009)
Issue (Month): 1 (January)
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Web page: http://www.elsevier.com/locate/inca/505551
Sequential auctions Private values Secret reserve price Multi-unit demand;
Other versions of this item:
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
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