This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Posted Prices and Bid Affiliation: Evidence from Experimental Auctions

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Jay R. Corrigan
Matthew C. Rousu

Additional information is available for the following registered author(s):

Abstract

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.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://economics.kenyon.edu/corrigan/publications/Posted%20Prices.pdf
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by Kenyon College, Department of Economics in its series Working Papers with number 0602.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length:
Date of creation: Nov 2006
Date of revision:
Handle: RePEc:ken:wpaper:0602

Contact 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).

Related research
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

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Shogren, Jason F. & Seung Y. Shin & Dermot J. Hayes & James B. Kliebenstein, 1994. "Resolving Differences in Willingness to Pay and Willingness to Accept," American Economic Review, American Economic Association, vol. 84(1), pages 255-70, March.
  2. David Dickinson & DeeVon Bailey, 2002. "Meat Traceability: Are U.S. Consumers Willing To Pay For It?," Working Papers 2002-07, Utah State University, Department of Economics. [Downloadable!]
    Other versions:
  3. Lusk, Jayson L., 2003. "Using Experimental Auctions for Marketing Applications: A Discussion," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 35(02), August. [Downloadable!]
  4. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1990. "Experimental Tests of the Endowment Effect and the Coase Theorem," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1325-48, December. [Downloadable!] (restricted)
  5. Shogren, Jason F & Hayes, Dermot J, 1997. "Resolving Differences in Willingness to Pay and Willingness to Accept: Reply," American Economic Review, American Economic Association, vol. 87(1), pages 241-44, March. [Downloadable!] (restricted)
    Other versions:
  6. Shogren, Jason F. & Cho, Sungwon & Koo, Cannon & List, John & Park, Changwon & Polo, Pablo & Wilhelmi, Robert, 2001. "Auction mechanisms and the measurement of WTP and WTA," Resource and Energy Economics, Elsevier, vol. 23(2), pages 97-109, April. [Downloadable!] (restricted)
  7. Buhr, Brian L. & Hayes, Dermot J. & Shogren, Jason F. & Kliebenstein, James B., 1993. "Valuing Ambiguity: The Case Of Genetically Engineered Growth Enhancers," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 18(02), December. [Downloadable!]
  8. Fox, John & Hayes, Dermot & Shogren, Jay, 2002. "Consumer Preferences for Food Irradiation: How Favorable and Unfavorable Descriptions Affect Preferences for Irradiated Pork in Experimental Auctions," Staff General Research Papers 5207, Iowa State University, Department of Economics.
    Other versions:
  9. Noussair, Charles & Robin, Stephane & Ruffieux, Bernard, 2002. "Do consumers not care about biotech foods or do they just not read the labels?," Economics Letters, Elsevier, vol. 75(1), pages 47-53, March. [Downloadable!] (restricted)
    Other versions:
  10. W. Bruce Traill, 2004. "Effect of information about benefits of biotechnology on consumer acceptance of genetically modified food: evidence from experimental auctions in the United States, England, and France," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 31(2), pages 179-204, June.
  11. Kagel, John H & Harstad, Ronald M & Levin, Dan, 1987. "Information Impact and Allocation Rules in Auctions with Affiliated Private Values: A Laboratory Study," Econometrica, Econometric Society, vol. 55(6), pages 1275-1304, November. [Downloadable!] (restricted)
  12. Jay R. Corrigan & Matthew C. Rousu, 2006. "The Effect of Initial Endowments in Experimental Auctions," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 88(2), pages 448-457, 05. [Downloadable!] (restricted)
    Other versions:
  13. Fox, John A. & Buhr, Brian L. & Shogren, Jason F. & Kliebenstein, James B. & Hayes, Dermot J., 1995. "Comparison of Preferences for Pork Sandwiches Produced from Animals With and Without Somatotropin Administration (A)," Staff General Research Papers 852, Iowa State University, Department of Economics.
  14. Jack Knetsch & Fang-Fang Tang & Richard Thaler, 2001. "The Endowment Effect and Repeated Market Trials: Is the Vickrey Auction Demand Revealing?," Experimental Economics, Springer, vol. 4(3), pages 257-269, December. [Downloadable!] (restricted)
  15. Wallace E. Huffman & Matthew Rousu & Jason F. Shogren & Abebayehu Tegene, 2003. "The Public Good Value of Information from Agribusinesses on Genetically Modified Foods," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 85(5), pages 1309-1315, December. [Downloadable!] (restricted)
    Other versions:
  16. Hayes, Dermot J. & Shogren, Jason F. & Shin, Seung Youll & Kliebenstein, James B., 1995. "Valuing Food Safety in Experimental Auction Markets," Staff General Research Papers 835, Iowa State University, Department of Economics.
  17. Kolstad, Charles D. & Guzman, Rolando M., 1999. "Information and the Divergence between Willingness to Accept and Willingness to Pay," Journal of Environmental Economics and Management, Elsevier, vol. 38(1), pages 66-80, July. [Downloadable!] (restricted)
    Other versions:
  18. Abbink, Klaus & Brandts, Jordi & McDaniel, Tanga, 2003. "Asymmetric Demand Information in Uniform and Discriminatory Call Auctions: An Experimental Analysis Motivated by Electricity Markets," Journal of Regulatory Economics, Springer, vol. 23(2), pages 125-44, March. [Downloadable!] (restricted)
  19. Shogren, Jason F & List, John A & Hayes, Dermot J, 2000. " Preference Learning in Consecutive Experimental Auctions," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 82(4), pages 1016-21, November. [Downloadable!] (restricted)
    Other versions:
  20. John A. List, 2001. "Do Explicit Warnings Eliminate the Hypothetical Bias in Elicitation Procedures? Evidence from Field Auctions for Sportscards," American Economic Review, American Economic Association, vol. 91(5), pages 1498-1507, December. [Downloadable!] (restricted)
  21. Milgrom, Paul R & Weber, Robert J, 1982. "A Theory of Auctions and Competitive Bidding," Econometrica, Econometric Society, vol. 50(5), pages 1089-1122, September. [Downloadable!] (restricted)
    Other versions:
  22. Ronald G. Cummings & Laura O. Taylor, 1999. "Unbiased Value Estimates for Environmental Goods: A Cheap Talk Design for the Contingent Valuation Method," American Economic Review, American Economic Association, vol. 89(3), pages 649-665, June. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. 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. [Downloadable!]
  2. 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. [Downloadable!]
  3. 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.
    Other versions:
Statistics
Access and download statistics

Did you know? All RePEc services are meant to be be free forever, as they are all run by volunteers.

This page was last updated on 2009-11-1.


This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.