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Bidding Behavior in Competing Auctions: Evidence from eBay

Author

Listed:
  • MINGLI ZHENG

    (University of Macau)

  • Robert McMillan

    (University of Toronto)

  • SAJID ANWAR

    (University of South Australia)

Abstract

Much of the existing auction literature treats auctions as running independently of one another, with each bidder choosing to participate in only one auction. However, in many online auctions, a number of substitutable goods are auctioned concurrently and bidders can bid on several auctions at the same time. Recent theoretical research shows how bidders can gain from the existence of competing auctions, the current paper providing the first empirical evidence in support of competing auctions theory using online auctions data from eBay. Our results indicate that a significant proportion of bidders do bid across competing auctions and that bidders tend to submit bids on auctions with the lowest standing bid, as the theory predicts. The paper also shows that winning bidders who cross-bid pay lower prices on average than winning bidders who do not.

Suggested Citation

  • MINGLI ZHENG & Robert McMillan & SAJID ANWAR, 2005. "Bidding Behavior in Competing Auctions: Evidence from eBay," Microeconomics 0505001, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpmi:0505001
    Note: Type of Document - pdf; pages: 23. forthcoming in EER
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    References listed on IDEAS

    as
    1. Radosveta Ivanova-Stenzel & Timothy C. Salmon, 2004. "Bidder Preferences among Auction Institutions," Economic Inquiry, Western Economic Association International, vol. 42(2), pages 223-236, April.
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    4. Alvin E. Roth & Axel Ockenfels, 2002. "Last-Minute Bidding and the Rules for Ending Second-Price Auctions: Evidence from eBay and Amazon Auctions on the Internet," American Economic Review, American Economic Association, vol. 92(4), pages 1093-1103, September.
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    More about this item

    Keywords

    Competing Auction; Cross-Bidding; Auction Empirics;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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