Endogenous participation in charity auctions
Data from a recent field experiment suggests that differences in participation rates are responsible for much of the variations in charity auction revenues across formats. We provide a theoretical framework for the analysis of this and other related results. The model illustrates the limits of previous results that assume full participation and introduces some new considerations to the choice of auction mechanism. It also implies, however, that the data cannot be explained in terms of participation costs alone: there must exist mechanism-specific obstacles to participation.
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