IDEAS home Printed from https://ideas.repec.org/a/inm/ormksc/v10y1991i1p40-57.html
   My bibliography  Save this article

On Auctions with Withdrawable Winning Bids

Author

Listed:
  • Michael H. Rothkopf

    (RUTCOR and Rutgers University)

Abstract

This paper considers sealed bidding in which bidders may submit two or more bids and after the bids are opened may, perhaps at a cost, withdraw bids that are more aggressive than would be necessary to win. Such withdrawal strategies are sometimes followed, but currently are surreptitious. However, legitimization of them would create potentially useful market mechanisms of potential interest to government agencies. These market mechanisms are also of theoretical interest since they are intermediate between first-price and second-price auctions. This paper presents models of such auctions. Both decision-theoretic models (applicable to surreptitious use of withdrawal strategies) and game theoretic models appropriate for openly withdrawable bid situations are developed. We describe a particular auction in which a winning bid was withdrawn and fit one of our decision theoretic models to data from it.

Suggested Citation

  • Michael H. Rothkopf, 1991. "On Auctions with Withdrawable Winning Bids," Marketing Science, INFORMS, vol. 10(1), pages 40-57.
  • Handle: RePEc:inm:ormksc:v:10:y:1991:i:1:p:40-57
    DOI: 10.1287/mksc.10.1.40
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/mksc.10.1.40
    Download Restriction: no

    File URL: https://libkey.io/10.1287/mksc.10.1.40?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Amar Cheema & Peter Leszczyc & Rajesh Bagchi & Richard Bagozzi & James Cox & Utpal Dholakia & Eric Greenleaf & Amit Pazgal & Michael Rothkopf & Michael Shen & Shyam Sunder & Robert Zeithammer, 2005. "Economics, Psychology, and Social Dynamics of Consumer Bidding in Auctions," Marketing Letters, Springer, vol. 16(3), pages 401-413, December.
    2. Wilfred Amaldoss & Sanjay Jain, 2008. "Joint Bidding in the Name-Your-Own-Price Channel: A Strategic Analysis," Management Science, INFORMS, vol. 54(10), pages 1685-1699, October.
    3. Zhixi Wan & Damian R. Beil, 2009. "RFQ Auctions with Supplier Qualification Screening," Operations Research, INFORMS, vol. 57(4), pages 934-949, August.
    4. Michael H. Rothkopf & Sunju Park, 2001. "An Elementary Introduction to Auctions," Interfaces, INFORMS, vol. 31(6), pages 83-97, December.
    5. Lorentziadis, Panos L., 2016. "Optimal bidding in auctions from a game theory perspective," European Journal of Operational Research, Elsevier, vol. 248(2), pages 347-371.
    6. Amar Cheema & Dipankar Chakravarti & Atanu R. Sinha, 2012. "Bidding Behavior in Descending and Ascending Auctions," Marketing Science, INFORMS, vol. 31(5), pages 779-800, September.
    7. Wilson, William W. & Diersen, Matthew A., 2001. "Competitive Bidding On Import Tenders: The Case Of Minor Oilseeds," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(1), pages 1-16, July.
    8. Octavian Carare & Michael Rothkopf, 2005. "Slow Dutch Auctions," Management Science, INFORMS, vol. 51(3), pages 365-373, March.
    9. Scott Fay, 2004. "Partial-Repeat-Bidding in the Name-Your-Own-Price Channel," Marketing Science, INFORMS, vol. 23(3), pages 407-418, February.
    10. Michael H. Rothkopf & Ronald M. Harstad & Yuhong Fu, 2003. "Is Subsidizing Inefficient Bidders Actually Costly?," Management Science, INFORMS, vol. 49(1), pages 71-84, January.
    11. Richard Engelbrecht-Wiggans & Ernan Haruvy & Elena Katok, 2007. "A Comparison of Buyer-Determined and Price-Based Multiattribute Mechanisms," Marketing Science, INFORMS, vol. 26(5), pages 629-641, 09-10.
    12. Lorentziadis, Panos L., 2014. "Bidding under auctioneer default risk," Omega, Elsevier, vol. 49(C), pages 123-133.
    13. Mordechai E. Schwarz, 2021. "Auctions with endogenous optingā€out fees and recursive winning procedures from the Talmud," International Journal of Economic Theory, The International Society for Economic Theory, vol. 17(4), pages 345-374, December.

    More about this item

    Keywords

    negotiations; bidding;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormksc:v:10:y:1991:i:1:p:40-57. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.