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Posted Prices and Bid Affiliation: Evidence from Experimental Auctions Author info | Abstract | Publisher info | Download info | Related research | Statistics Jay R. Corrigan
Matthew C. Rousu
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In most experimental auctions, researchers ask participants to bid on the same item in multiple potentially binding rounds, posting the price submitted by the top bidder or bidders after each of those rounds. If bids submitted in later rounds are affiliated with posted prices from earlier rounds, this practice could result in biased value estimates. In this article we discuss the results of an experiment designed explicitly to test whether posted prices affect bidding behavior. We find that for familiar items, high posted prices lead to increased bids in subsequent rounds. Our results have implications for researchers conducting experimental auctions.
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Paper provided by Kenyon College, Department of Economics in its series Working Papers with number
0602.
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Date of creation: Nov 2006Date of revision:
Handle: RePEc:ken:wpaper:0602Contact details of provider: Web page: http://economics.kenyon.edu/ More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (Jay Corrigan).
Keywords: Experimental Auctions ; Posted Prices ; Affiliation ; Other versions of this item:
Find related papers by JEL classification: C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
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"Unbiased Value Estimates for Environmental Goods: A Cheap Talk Design for the Contingent Valuation Method ,"
American Economic Review ,
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Chern, Wen S. & Chang, Chun-Yu, 2009.
"Benefit Evaluation of the Country of Origin Labeling in Taiwan: Results from Auction Experiment ,"
2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin
49215, Agricultural and Applied Economics Association.
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Matthew C. Rousu & Robert H. Beach & Jay R. Corrigan, 2008.
"The Effects of Selling Complements and Substitutes on Consumer Willingness to Pay: Evidence from Laboratory Experiments ,"
Working Papers
0801, Kenyon College, Department of Economics.
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Rousu, Matthew & Huffman, Wallace & Shogren, Jason F. & Tegene, Abebayehu, 2006.
"Effects and Value of Verifiable Information in a Controversial Market: Evidence from Lab Auctions of Genetically Modified Food ,"
Staff General Research Papers
12702, Iowa State University, Department of Economics.
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