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Economic Insights from Internet Auctions: A Survey

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  • Patrick Bajari
  • Ali Hortacsu

Abstract

This paper surveys recent studies of Internet auctions. Four main areas of research are summarized. First, economists have documented strategic bidding in these markets and attempted to understand why sniping, or bidding at the last second, occurs. Second, some researchers have measured distortions from asymmetric information due, for instance, to the winner's curse. Third, we explore research about the role of reputation in online auctions. Finally, we discuss what Internet auctions have to teach us about auction design.

Suggested Citation

  • Patrick Bajari & Ali Hortacsu, 2003. "Economic Insights from Internet Auctions: A Survey," NBER Working Papers 10076, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:10076
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    File URL: http://www.nber.org/papers/w10076.pdf
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    References listed on IDEAS

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    8. Paul Resnick & Richard Zeckhauser & John Swanson & Kate Lockwood, 2006. "The value of reputation on eBay: A controlled experiment," Experimental Economics, Springer;Economic Science Association, vol. 9(2), pages 79-101, June.
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    10. Philip A. Haile & Han Hong & Matthew Shum, 2003. "Nonparametric Tests for Common Values at First-Price Sealed-Bid Auctions," NBER Working Papers 10105, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Cavallo, Alberto & Rigobon, Roberto, 2011. "The Distribution of the Size of Price Changes," Working Papers 2011-011, Banco Central de Reserva del Perú.
    2. Axel Ockenfels & David Reiley & Abdolkarim Sadrieh, 2006. "Online Auctions," NBER Working Papers 12785, National Bureau of Economic Research, Inc.
    3. Xiao, Mo, 2010. "Is quality accreditation effective? Evidence from the childcare market," International Journal of Industrial Organization, Elsevier, vol. 28(6), pages 708-721, November.

    More about this item

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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