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Testing Informational Assumptions in Common Value Bidding Models


  • Hoffman, Elizabeth
  • Marsden, James R


This paper provides an example of a means of linking mathematical theory, laboratory experiments, and standard empirical w ork. Theory, by necessity, abstracts from the naturally occurring world, and exp eriments designed to test theory must incorporate the same abstractions. On the other hand, empirical tests are generally performed on naturally occurring data, which may not reflect those same abstractions. Given this possible divergence, naturally occurring data should be tested for consistency with theoretical assum ptions whenever possible. On the basis of standard symmetric bidding theory, thi s paper reports on a preliminary version of such a test for offshore oil bidding data. Copyright 1986 by The editors of the Scandinavian Journal of Economics.

Suggested Citation

  • Hoffman, Elizabeth & Marsden, James R, 1986. " Testing Informational Assumptions in Common Value Bidding Models," Scandinavian Journal of Economics, Wiley Blackwell, vol. 88(4), pages 627-641.
  • Handle: RePEc:bla:scandj:v:88:y:1986:i:4:p:627-41

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    References listed on IDEAS

    1. James H. Stock & Mark W. Watson, 1987. "Interpreting Evidence on Money-Income Causality," NBER Working Papers 2228, National Bureau of Economic Research, Inc.
    2. Vogel, Robert C, 1974. "The Dynamics of Inflation in Latin America, 1950-1969," American Economic Review, American Economic Association, vol. 64(1), pages 102-114, March.
    3. Robert G. King & Mark W. Watson, 1997. "Testing long-run neutrality," Economic Quarterly, Federal Reserve Bank of Richmond, issue Sum, pages 69-101.
    4. McCallum, Bennett T., 1984. "On low-frequency estimates of long-run relationships in macroeconomics," Journal of Monetary Economics, Elsevier, vol. 14(1), pages 3-14, July.
    5. Lucas, Robert E, Jr, 1980. "Two Illustrations of the Quantity Theory of Money," American Economic Review, American Economic Association, vol. 70(5), pages 1005-1014, December.
    6. Boschen, John F. & Mills, Leonard O., 1988. "Tests of the relation between money and output in the real business cycle model," Journal of Monetary Economics, Elsevier, vol. 22(3), pages 355-374.
    7. Terry J. Fitzgerald, 1999. "Money growth and inflation: how long is the long run?," Economic Commentary, Federal Reserve Bank of Cleveland, issue Aug.
    8. Bruce D. Smith, 1988. "The relationship between money and prices: some historical evidence reconsidered," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Sum, pages 18-32.
    9. Geweke, John F, 1986. "The Superneutrality of Money in the United States: An Interpretation of the Evidence," Econometrica, Econometric Society, vol. 54(1), pages 1-21, January.
    10. Milton Friedman & Anna J. Schwartz, 1963. "A Monetary History of the United States, 1867–1960," NBER Books, National Bureau of Economic Research, Inc, number frie63-1, January.
    11. Gerald P. Dwyer & R. W. Hafer, 1999. "Are money growth and inflation still related?," Economic Review, Federal Reserve Bank of Atlanta, issue Q2, pages 32-43.
    12. Neil Wallace, 1998. "A dictum for monetary theory," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Win, pages 20-26.
    13. George T. McCandless & Warren E. Weber, 1995. "Some monetary facts," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Sum, pages 2-11.
    14. Gerald P. Dwyer & R. W. Hafer, 1988. "Is money irrelevant?," Review, Federal Reserve Bank of St. Louis, issue May, pages 3-17.
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    Cited by:

    1. Jean-Jacques Laffont, 1998. "Théorie des jeux et économie empirique : le cas des données issues d'enchères," Économie et Prévision, Programme National Persée, vol. 132(1), pages 121-137.
    2. Laffont, Jean-Jacques, 1997. "Game theory and empirical economics: The case of auction data 1," European Economic Review, Elsevier, vol. 41(1), pages 1-35, January.
    3. Michel Mougeot & Florence Naegelen, 1991. "Malédiction du vainqueur et rationalité économique," Revue Économique, Programme National Persée, vol. 42(1), pages 29-50.

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