Charity Auctions: A Field Experimental Investigation
Auctions are a popular way to raise money for charities, but relatively little is known, either theoretically or empirically, about the properties of charity auctions. The small theoretical literature suggests that the all-pay auction should garner more money than winner-pay auctions. We conduct field experiments to test which sealed bid format, first price, second price or all-pay raises the most money. Our experiment suggests that both the all-pay and second price formats are dominated by the first price auction. Our design also allows us to identify differential participation as the source of the difference between existing theory and the field. To conclude, we show that a model of charity auctions augmented by an endogenous participation decision predicts the revenue ordering that we see in the field.
|Date of creation:||Sep 2004|
|Date of revision:|
|Contact details of provider:|| |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Samuelson, William F., 1985. "Competitive bidding with entry costs," Economics Letters, Elsevier, vol. 17(1-2), pages 53-57.
- Klemperer, Paul, 1999.
" Auction Theory: A Guide to the Literature,"
Journal of Economic Surveys,
Wiley Blackwell, vol. 13(3), pages 227-86, July.
- Klemperer, Paul, 1999. "Auction Theory: a Guide to the Literature," CEPR Discussion Papers 2163, C.E.P.R. Discussion Papers.
- Klemperer, P., 1999. "Auction Theory: a Guide to the Literature," Economics Papers 1999-w12, Economics Group, Nuffield College, University of Oxford.
- Paul Klemperer, 1999. "Auction Theory: A Guide to the Literature," Microeconomics 9903002, EconWPA.
- Paul Klemperer, 1999. "Auction Theory: A Guide to the Literature," Economics Series Working Papers 1999-W12, University of Oxford, Department of Economics.
- David Lucking-Reiley, 1999.
"Using Field Experiments to Test Equivalence between Auction Formats: Magic on the Internet,"
American Economic Review,
American Economic Association, vol. 89(5), pages 1063-1080, December.
- David Lucking-Reiley, 1999. "Using field experiments to test equivalence between auction formats: Magic on the internet," Framed Field Experiments 00183, The Field Experiments Website.
- David Lucking-Reiley & John A. List, 2000.
"Demand Reduction in Multiunit Auctions: Evidence from a Sportscard Field Experiment,"
American Economic Review,
American Economic Association, vol. 90(4), pages 961-972, September.
- David Lucking-Reiley & John List, 2000. "Demand Reduction in Multiunit Auctions: Evidence from a Sportscard Field Experiment," Natural Field Experiments 00520, The Field Experiments Website.
- Laffont, J.J., 1996.
"Game Theory and Empirical Economics: The Case of Auction Data,"
95.394, Toulouse - GREMAQ.
- 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.
- John Morgan & Martin Sefton, 2000. "Funding Public Goods with Lotteries: Experimental Evidence," Review of Economic Studies, Oxford University Press, vol. 67(4), pages 785-810.
- Jehiel, Philippe & Moldovanu, Benny & Stacchetti, Ennio, 1996.
"How (Not) to Sell Nuclear Weapons,"
American Economic Review,
American Economic Association, vol. 86(4), pages 814-29, September.
- Andreoni, James, 1989. "Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1447-58, December.
- Heckman, James, 2013.
"Sample selection bias as a specification error,"
Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
- Arthur J.H.C. Schram & Sander Onderstal, 2009. "Bidding To Give: An Experimental Comparison Of Auctions For Charity," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 50(2), pages 431-457, 05.
- David Reiley & John List, 2008.
Artefactual Field Experiments
00091, The Field Experiments Website.
- Engelbrecht-Wiggans Richard, 1994. "Auctions with Price-Proportional Benefits to Bidders," Games and Economic Behavior, Elsevier, vol. 6(3), pages 339-346, May.
- Maskin, Eric S & Riley, John G, 1984.
"Optimal Auctions with Risk Averse Buyers,"
Econometric Society, vol. 52(6), pages 1473-1518, November.
- Jacob K. Goeree & Emiel Maasland & Sander Onderstal & John L. Turner, 2005. "How (Not) to Raise Money," Journal of Political Economy, University of Chicago Press, vol. 113(4), pages 897-926, August.
- Gadi Fibich & Arieh Gavious & Aner Sela, 2006. "All-pay auctions with risk-averse players," International Journal of Game Theory, Springer;Game Theory Society, vol. 34(4), pages 583-599, November.
- Maxim Engers & Brian McManus, 2007. "Charity Auctions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(3), pages 953-994, 08.
- L. Randall Wray & Stephanie Bell, 2004. "Introduction," Chapters, in: Credit and State Theories of Money, chapter 1 Edward Elgar Publishing.
- Stegeman, Mark, 1996. "Participation Costs and Efficient Auctions," Journal of Economic Theory, Elsevier, vol. 71(1), pages 228-259, October.
- John List & Matti Liski, 2005. "Introduction," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 31(2), pages 121-121, 06.
- Philippe Robert-Demontrond & R. Ringoot, 2004. "Introduction," Post-Print halshs-00081823, HAL.
- Douglas D. Davis & Laura Razzolini & Robert Reilly & Bart J. Wilson, 2003. "Raising Revenues for Charity: Auctions versus Lotteries," Working Papers 0301, VCU School of Business, Department of Economics.
When requesting a correction, please mention this item's handle: RePEc:mdl:mdlpap:0417. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Vijaya Wunnava)
If references are entirely missing, you can add them using this form.