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Understanding preferences for ascending auctions, Buy-It-Now auctions and fixed prices

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  • J.M.J. Delnoij
  • K.J.M. De Jaegher
  • S. Rosenkranz

Abstract

This paper experimentally analyzes how consumers decide between entering a fixed price, an ascending auction or a BIN auction. We find that such entry decisions depend both on potential payoffs (price aspects) and consumer characteristics (non-price aspects). For values smaller than or equal to BIN prices, subjects are more likely to enter a mechanism that involves bidding. Conversely, for values greater than BIN prices, subjects are more likely to enter a mechanism that involves immediate buying. We further find that price aspects mainly play a role for values greater than BIN prices, whereas non-price aspects play a role for values smaller than or equal to BIN prices. Impatience makes subjects less likely to enter a mechanism involving bidding, whereas sensation seekingness and regret make subjects more likely to enter such a mechanism. Gender also has an impact on entry decisions.

Suggested Citation

  • J.M.J. Delnoij & K.J.M. De Jaegher & S. Rosenkranz, 2014. "Understanding preferences for ascending auctions, Buy-It-Now auctions and fixed prices," Working Papers 14-02, Utrecht School of Economics.
  • Handle: RePEc:use:tkiwps:1402
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    File URL: https://dspace.library.uu.nl/bitstream/handle/1874/293957/14-02.pdf
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    Cited by:

    1. Antonio Filippin & Paolo Crosetto, 2016. "A Reconsideration of Gender Differences in Risk Attitudes," Management Science, INFORMS, vol. 62(11), pages 3138-3160, November.

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    Keywords

    Entry decisions; Fixed price; Ascending auction; Buy-It-Now auction;

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