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Earned wealth, engaged bidders? Evidence from a second price auction

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  • Nicolas Jacquemet

    () (CES - Centre d'économie de la Sorbonne - CNRS - Centre National de la Recherche Scientifique - UP1 - Université Panthéon-Sorbonne, PSE - Paris School of Economics)

  • Robert-Vincent Joule

    () (LPS - Laboratoire de Psychologie Sociale - AMU - Aix Marseille Université)

  • Stephane Luchini

    () (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université - EHESS - École des hautes études en sciences sociales)

  • Jason Shogren

    () (Departement Economy and Finance, University of Wyoming - UW - University of Wyoming)

Abstract

This paper considers whether earned wealth affects bidding behavior in an induced-value second-price auction. We find people bid more sincerely in the auction with earned wealth given monetary incentives; earned wealth did not induce sincere bidding in hypothetical auctions.

Suggested Citation

  • Nicolas Jacquemet & Robert-Vincent Joule & Stephane Luchini & Jason Shogren, 2009. "Earned wealth, engaged bidders? Evidence from a second price auction," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00429894, HAL.
  • Handle: RePEc:hal:cesptp:halshs-00429894
    DOI: 10.1016/j.econlet.2009.05.010
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00429894
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    References listed on IDEAS

    as
    1. Jacquemet, Nicolas & Joule, Robert-Vincent & Luchini, Stéphane & Shogren, Jason F., 2013. "Preference elicitation under oath," Journal of Environmental Economics and Management, Elsevier, vol. 65(1), pages 110-132.
    2. Todd L. Cherry & Peter Frykblom & Jason F. Shogren, 2002. "Hardnose the Dictator," American Economic Review, American Economic Association, vol. 92(4), pages 1218-1221, September.
    3. Cherry, Todd L. & Kroll, Stephan & Shogren, Jason F., 2005. "The impact of endowment heterogeneity and origin on public good contributions: evidence from the lab," Journal of Economic Behavior & Organization, Elsevier, vol. 57(3), pages 357-365, July.
    4. Jeremy Clark, 2002. "House Money Effects in Public Good Experiments," Experimental Economics, Springer;Economic Science Association, vol. 5(3), pages 223-231, December.
    5. Richard H. Thaler & Eric J. Johnson, 1990. "Gambling with the House Money and Trying to Break Even: The Effects of Prior Outcomes on Risky Choice," Management Science, INFORMS, vol. 36(6), pages 643-660, June.
    6. Rutstrom, E. Elisabet & Williams, Melonie B., 2000. "Entitlements and fairness:: an experimental study of distributive preferences," Journal of Economic Behavior & Organization, Elsevier, vol. 43(1), pages 75-89, September.
    7. Jeremy Clark, 1998. "Fairness in Public Good Provision: An Investigation of Preferences for Equality and Proportionality," Canadian Journal of Economics, Canadian Economics Association, vol. 31(3), pages 708-729, August.
    8. Glenn Harrison, 2007. "House money effects in public good experiments: Comment," Experimental Economics, Springer;Economic Science Association, vol. 10(4), pages 429-437, December.
    9. William Vickrey, 1961. "Counterspeculation, Auctions, And Competitive Sealed Tenders," Journal of Finance, American Finance Association, vol. 16(1), pages 8-37, March.
    10. Nicolas Jacquemet & Stephane Luchini & Robert-Vincent Joule & Jason Shogren, 2008. "Do French student really bid sincerely?," Working Papers halshs-00277282, HAL.
    11. Greiner, Ben, 2004. "An Online Recruitment System for Economic Experiments," MPRA Paper 13513, University Library of Munich, Germany.
    12. Nicolas Jacquemet & Stephane Luchini & Robert-Vincent Joule & Jason Shogren, 2008. "Do French student really bid sincerely?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00277282, HAL.
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    More about this item

    Keywords

    Auctions; Demand revelation; Experimental valuation; Hypothetical bias; Earned money;

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