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Bidding Behavior in Competing Auctions: Evidence from eBay

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Author Info
MINGLI ZHENG (University of Macau)
Robert McMillan (University of Toronto)
SAJID ANWAR (University of South Australia)

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Abstract

Much of the existing auction literature treats auctions as running independently of one another, with each bidder choosing to participate in only one auction. However, in many online auctions, a number of substitutable goods are auctioned concurrently and bidders can bid on several auctions at the same time. Recent theoretical research shows how bidders can gain from the existence of competing auctions, the current paper providing the first empirical evidence in support of competing auctions theory using online auctions data from eBay. Our results indicate that a significant proportion of bidders do bid across competing auctions and that bidders tend to submit bids on auctions with the lowest standing bid, as the theory predicts. The paper also shows that winning bidders who cross-bid pay lower prices on average than winning bidders who do not.

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File URL: http://129.3.20.41/eps/mic/papers/0505/0505001.pdf
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Publisher Info
Paper provided by EconWPA in its series Microeconomics with number 0505001.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 23 pages
Date of creation: 06 May 2005
Date of revision:
Handle: RePEc:wpa:wuwpmi:0505001

Note: Type of Document - pdf; pages: 23. forthcoming in EER
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Web page: http://129.3.20.41

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Related research
Keywords: Competing Auction; Cross-Bidding; Auction Empirics;

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Find related papers by JEL classification:
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. Peters, Michael & Severinov, Sergei, 1997. "Competition among Sellers Who Offer Auctions Instead of Prices," Journal of Economic Theory, Elsevier, vol. 75(1), pages 141-179, July. [Downloadable!] (restricted)
    Other versions:
  2. Bajari, Patrick & Hortacsu, Ali, 2003. " The Winner's Curse, Reserve Prices, and Endogenous Entry: Empirical Insights from eBay Auctions," RAND Journal of Economics, The RAND Corporation, vol. 34(2), pages 329-55, Summer.
  3. Ockenfels, Axel & Roth, Alvin E., 2006. "Late and multiple bidding in second price Internet auctions: Theory and evidence concerning different rules for ending an auction," Games and Economic Behavior, Elsevier, vol. 55(2), pages 297-320, May. [Downloadable!] (restricted)
    Other versions:
  4. McAfee, R Preston, 1993. "Mechanism Design by Competing Sellers," Econometrica, Econometric Society, vol. 61(6), pages 1281-1312, November. [Downloadable!] (restricted)
  5. David Lucking-Reiley, 1999. "Using field experiments to test equivalence between auction formats: Magic On the Internet," Framed Field Experiments 0055, The Field Experiments Website. [Downloadable!]
  6. Patrick Bajari & Ali Hortacsu, 2004. "Economic Insights from Internet Auctions," Journal of Economic Literature, American Economic Association, vol. 42(2), pages 457-486, June. [Downloadable!] (restricted)
  7. Michael Peters & Sergei Severinov, 2001. "Internet Auctions with Many Traders," Working Papers peters-01-01, University of Toronto, Department of Economics. [Downloadable!]
    Other versions:
  8. Resnick, Paul & Zeckhauser, Richard & Swanson, John & Lockwood, Kate, 2003. "The Value of Reputation on eBay: A Controlled Experiment," Working Paper Series rwp03-007, Harvard University, John F. Kennedy School of Government. [Downloadable!]
    Other versions:
  9. Alvin E. Roth & Axel Ockenfels, 2000. "Last Minute Bidding and the Rules for Ending Second-Price Auctions: Theory and Evidence from a Natural Experiment on the Internet," NBER Working Papers 7729, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  10. Lucking-Reiley, David, 2000. "Auctions on the Internet: What's Being Auctioned, and How?," Journal of Industrial Economics, Blackwell Publishing, vol. 48(3), pages 227-52, September. [Downloadable!] (restricted)
  11. Glenn Ellison & Drew Fudenberg & Markus Mobius, 2003. "Competing Auctions," Levine's Bibliography 506439000000000092, UCLA Department of Economics. [Downloadable!]
    Other versions:
  12. David Lucking-Reiley, 1999. "Using Field Experiments to Test Equivalence between Auction Formats: Magic on the Internet," American Economic Review, American Economic Association, vol. 89(5), pages 1063-1080, December. [Downloadable!] (restricted)
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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. Ernan Haruvy & Peter Popkowski Leszczyc & Octavian Carare & James Cox & Eric Greenleaf & Wolfgang Jank & Sandy Jap & Young-Hoon Park & Michael Rothkopf, 2008. "Competition between auctions," Marketing Letters, Springer, vol. 19(3), pages 431-448, December. [Downloadable!] (restricted)
  2. Sascha Füllbrunn, 2007. "Collusion or Sniping in simultaneous ascending Auctions," FEMM Working Papers 07025, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management. [Downloadable!]
  3. Sascha Füllbrunn, 2009. "A comparison of Candle Auctions and Hard Close Auctions with Common Values," FEMM Working Papers 09019, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management. [Downloadable!]
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