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Selling Money on Ebay: A Field Study of Surplus Division

Author

Listed:
  • Alia Gizatulina

    (University of St. Gallen and Max Planck Institute for Research on Collective Goods)

  • Olga Gorelkina

    (Max Planck Institute for Research on Collective Goods)

Abstract

We study the division of trade surplus in a competitive market environment by conducting a natural field experiment on German eBay. Acting as a seller, we offer Amazon gift cards with face values of up to 500 Euro. Randomly arriving buyers, the subjects of our experiment, make price offers according to eBay rules. Using a novel decomposition method, we infer offered shares of trade surplus and find that the average share proposed to the seller amounts to 29%. Additionally, we document: (i) insignificant effects of stake size; (ii) poor use of strategically relevant public information; and (iii) behavioural differences between East and West German subjects.

Suggested Citation

  • Alia Gizatulina & Olga Gorelkina, 2016. "Selling Money on Ebay: A Field Study of Surplus Division," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2016_20, Max Planck Institute for Research on Collective Goods.
    • Handle: RePEc:mpg:wpaper:2016_20
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    More about this item

    Keywords

    Field experiment; ultimatum game; surplus division; bargaining; Internet trade; eBay;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • C57 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Econometrics of Games and Auctions

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