Experiments on Auction Valuation and Endogenous Entry
AbstractWe present results of several experiments that deal with endogenous entry in auctions and auction valuation. One observation that is constant across all of the experiments we report is that laboratory subjects have a difficult time evaluating potential gains from auctions. Even after they are given some experience with particular auctions, the uncertainty inherent in the auctions (the probability of winning as well as the potential gains from winning) makes it difficult for subjects to compare different auction mechanisms. This highlights the need for new experimental procedures to be used for testing theories that involve endogenous auction entry in the laboratory.
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Bibliographic InfoPaper provided by The Pennsylvania State University, Laboratory for Economic Mangement and Auctions in its series Working Papers with number ek1.
Length: 27 pages
Date of creation: 01 Oct 2004
Date of revision: 01 Oct 2004
Experiments on Auction Valuation and Endogenous Entry;
Find related papers by JEL classification:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-02-20 (All new papers)
- NEP-COM-2005-02-20 (Industrial Competition)
- NEP-EXP-2005-02-20 (Experimental Economics)
- NEP-GTH-2005-02-20 (Game Theory)
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