The Fixed Price Offer Mechanism in Trade Me Online Auctions
The Fixed Price Offer (FPO) mechanism in Trade Me auctions allows sellers to make a take-it-or-leave-it offer at the conclusion of an unsuccessful auction. We investigate the effects of the FPO option on strategies and outcomes in independent-value auctions. The FPO option induces some bidders with a value above the seller’s reserve to wait for an FPO instead of bidding. Overall, the FPO option increases the probability of sale but reduces expected seller revenue compared to a standard auction. The impact of the FPO option is reduced when the number of bidders increases.
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- AMIR, Rabah, 1994.
"Cournot Oligopoly and the Theory of Supermodular Games,"
CORE Discussion Papers
1994013, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Amir, Rabah, 1996. "Cournot Oligopoly and the Theory of Supermodular Games," Games and Economic Behavior, Elsevier, vol. 15(2), pages 132-148, August.
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