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Your call: eBay and demand for the iPhone 4

Author

Listed:
  • Waterson, Michael

    (Department of Economics, University of Warwick)

  • Doyle, Chris

    (Department of Economics, University of Warwick)

Abstract

The iPhone 4 was introduced into the UK market on 24th June 2010 to significant consumer interest. This clearly exceeded supply through conventional channels, since there was very extensive activity in terms of bidding on eBay auctions for the product. We monitored all eBay transactions on the iPhone 4 for six weeks from introduction, with total transactions amounting to around £1.5m. We analyse determinants of the winning bid in terms of characteristics of the phone, the seller and the buyer. Our most notable and novel finding relative to previous studies is a very significant premium over list price being paid in almost all cases, with positive uplift factors including whether the phone was unlocked and whether it could be sold overseas. Demand fell over time, as evidenced by lower achieved prices, but the fall in price was relatively modest. A significant premium of 32GB over 16GB versions is revealed.

Suggested Citation

  • Waterson, Michael & Doyle, Chris, 2010. "Your call: eBay and demand for the iPhone 4," The Warwick Economics Research Paper Series (TWERPS) 949, University of Warwick, Department of Economics.
  • Handle: RePEc:wrk:warwec:949
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    File URL: https://warwick.ac.uk/fac/soc/economics/research/workingpapers/2010/twerp_949.pdf
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    Cited by:

    1. Nicollier, Luciana A., 2012. "Customers' Complaints and Quality Regulation," The Warwick Economics Research Paper Series (TWERPS) 990, University of Warwick, Department of Economics.

    More about this item

    Keywords

    eBay auctions ; demand revelation ; auctions ; bidding ; short supply ; versioning JEL Classification: D44 ; L81 ; D12 ; L63;

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment

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