Sequential Auction Design And Participant Behavior

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Sequential Auction Design and Participant Behavior

Author : Kendra C. Taylor
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (621 download)

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Book Synopsis Sequential Auction Design and Participant Behavior by : Kendra C. Taylor

Download or read book Sequential Auction Design and Participant Behavior written by Kendra C. Taylor and published by . This book was released on 2005 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This thesis studies the impact of sequential auction design on participant behavior from both a theoretical and an empirical viewpoint. In the first of the two analyses, three sequential auction designs are characterized and compared based on expected profitability to the participants. The optimal bid strategy is derived as well. One of the designs, the alternating design, is a new auction design and is a blend of the other two. It assumes that the ability to bid in or initiate an auction is given to each side of the market in an alternating fashion to simulate seasonal markets. The conditions for an equilibrium auction design are derived and characteristics of the equilibrium are outlined. The primary result is that the alternating auction is a viable compromise auction design when buyers and suppliers disagree on whether to hold a sequence of forward or reverse auctions. We also found the value of information on future private value for a strategic supplier in a two-period case of the alternating and reverse auction designs. The empirical work studies the cause of low aggregation of timber supply in reverse auctions of an online timber exchange. Unlike previous research results regarding timber auctions, which focus on offline public auctions held by the U.S. Forest Service, we study online private auctions between logging companies and mills. A limited survey of the online auction data revealed that the auctions were successful less than 50% of the time. Regression analysis is used to determine which internal and external factors to the auction affect the aggregation of timber in an effort to determine the reason that so few auctions succeeded. The analysis revealed that the number of bidders, the description of the good and the volume demanded had a significant influence on the amount of timber supplied through the online auction exchange. A plausible explanation for the low aggregation is that the exchange was better suited to check the availability for custom cuts of timber and to transact standard timber.

Bidding Behavior Evolution in Sequential Auctions

Author : Paulo Goes
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis Bidding Behavior Evolution in Sequential Auctions by : Paulo Goes

Download or read book Bidding Behavior Evolution in Sequential Auctions written by Paulo Goes and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Retailers are increasingly exploiting sequential online auctions as an effective and low cost distribution channel for disposing large quantities of inventory. In such auction environments, bidders have the opportunity of participating in many auctions to learn and choose the bidding strategy that best fits their preferences. Previous studies have mostly focused on identifying bidding strategies in single, isolated online auctions. Using a large data set collected from sequential online auctions, we first characterize bidding strategies in this interesting online environment and then develop an empirical model to explain bidders' adoption of different strategies. We also examine how bidders change their strategies over time. Our findings challenge the general belief that bidders employ their strategies regardless of experience or their specific demand. We find that bidders' demand, participation experience, and auction design parameters affect their choice of bidding strategies. Bidders with unit demand are likely to choose early bidding strategies, while those with multiple unit demand adopt late bidding strategies. Auction design parameters that affect bidders' perception of demand and supply trends affect bidders' choice of bidding strategies. As bidders gain experience within a sequence of auctions, they start choosing late bidding strategies. Our findings help auctioneers to design auction sequences that maximize their objectives. Full paper available at https://doi.org/10.2307/41703496.

Understanding Willingness-to-Pay Formation of Repeat Bidders in Sequential Online Auctions

Author : Paulo Goes
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis Understanding Willingness-to-Pay Formation of Repeat Bidders in Sequential Online Auctions by : Paulo Goes

Download or read book Understanding Willingness-to-Pay Formation of Repeat Bidders in Sequential Online Auctions written by Paulo Goes and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: A growing number of vendors are using a sequence of online auctions to sell large inventories of identical items. Although bidding strategies and bidder behavior in single auctions have been extensively studied, limited research exists on bidding in sequential auctions. We seek to explain how bidders in such an environment learn from the information, and form and update their willingness to pay (WTP). Using a large data set from an online auction retailer, we analyze the evolution of the bidders' WTP as well as the effect of auction design on bidders' WTP in sequential auctions. We see our study in the context of a longitudinal field experiment, in which we were able to track actions of repeat bidders over an extended period of time. Our results show that bidders' WTP in sequential auctions can be explained from their demand characteristics, their participation experience in previous auctions, outcomes in previous auctions, and auction design parameters. We also observe, characterize, and measure what we call a modified demand reduction effect exhibited across different auctions, over time, by multiunit demand bidders. Our findings are important to enable better auction mechanism design, and more sophisticated bidding tools that explore the rich information environment of sequential auctions. Full paper available at https://doi.org/10.1287/isre.1080.0216.

Large-scale Multi-item Auctions

Author : Sascha Michael Schweitzer
Publisher : KIT Scientific Publishing
ISBN 13 : 3866449046
Total Pages : 212 pages
Book Rating : 4.8/5 (664 download)

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Book Synopsis Large-scale Multi-item Auctions by : Sascha Michael Schweitzer

Download or read book Large-scale Multi-item Auctions written by Sascha Michael Schweitzer and published by KIT Scientific Publishing. This book was released on 2014-10-16 with total page 212 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book presents two experimental studies that deal with the comparison of multi-item auction designs for two specific applications: the sale of 2.6 GHz radio spectrum rights in Europe, and the sale of emissions permits in Australia. In order to tackle the complexity of these experiments, a cognitively based toolkit is proposed, including modularized video instructions, comprehension tests, a learning platform, a graphical one-screen user interface, and comprehension-based group matching.

Putting Auction Theory to Work

Author : Paul Milgrom
Publisher : Cambridge University Press
ISBN 13 : 1139449168
Total Pages : 378 pages
Book Rating : 4.1/5 (394 download)

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Book Synopsis Putting Auction Theory to Work by : Paul Milgrom

Download or read book Putting Auction Theory to Work written by Paul Milgrom and published by Cambridge University Press. This book was released on 2004-01-12 with total page 378 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book provides a comprehensive introduction to modern auction theory and its important new applications. It is written by a leading economic theorist whose suggestions guided the creation of the new spectrum auction designs. Aimed at graduate students and professionals in economics, the book gives the most up-to-date treatments of both traditional theories of 'optimal auctions' and newer theories of multi-unit auctions and package auctions, and shows by example how these theories are used. The analysis explores the limitations of prominent older designs, such as the Vickrey auction design, and evaluates the practical responses to those limitations. It explores the tension between the traditional theory of auctions with a fixed set of bidders, in which the seller seeks to squeeze as much revenue as possible from the fixed set, and the theory of auctions with endogenous entry, in which bidder profits must be respected to encourage participation.

A Primer on Auction Design, Management, and Strategy

Author : David J. Salant
Publisher : MIT Press
ISBN 13 : 0262321831
Total Pages : 199 pages
Book Rating : 4.2/5 (623 download)

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Book Synopsis A Primer on Auction Design, Management, and Strategy by : David J. Salant

Download or read book A Primer on Auction Design, Management, and Strategy written by David J. Salant and published by MIT Press. This book was released on 2014-12-26 with total page 199 pages. Available in PDF, EPUB and Kindle. Book excerpt: A guide to modeling and analyzing auctions, with the applications of game theory and auction theory to real-world auction decision making. Auctions are highly structured market transactions primarily used in thin markets (markets with few participants and infrequent transactions). In auctions, unlike most other markets, offers and counteroffers are typically made within a structure defined by a set of rigid and comprehensive rules. Because auctions are essentially complex negotiations that occur within a fully defined and rigid set of rules, they can be analyzed by game theoretic models more accurately and completely than can most other types of market transactions. This book offers a guide for modeling, analyzing, and predicting the outcomes of auctions, focusing on the application of game theory and auction theory to real-world auction design and decision making. After a brief introduction to fundamental concepts from game theory, the book explains some of the more significant results from the auction theory literature, including the revenue (or payoff) equivalence theorem, the winner's curse, and optimal auction design. Chapters on auction practice follow, addressing collusion, competition, information disclosure, and other basic principles of auction management, with some discussion of auction experiments and simulations. Finally, the book covers auction experience, with most of the discussion centered on energy and telecommunications auctions, which have become the proving ground for many new auction designs. A clear and concise introduction to auctions, auction design, and auction strategy, this Primer will be an essential resource for students, researchers, and practitioners.

Sequential Asymmetric Auctions with Endogenous Participation

Author : Flavio M. Menezes
Publisher :
ISBN 13 :
Total Pages : 34 pages
Book Rating : 4.:/5 (318 download)

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Book Synopsis Sequential Asymmetric Auctions with Endogenous Participation by : Flavio M. Menezes

Download or read book Sequential Asymmetric Auctions with Endogenous Participation written by Flavio M. Menezes and published by . This book was released on 1994 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt:

An Experimental Study on Sequential Auctions with Privately Known Capacities

Author : Luca Corazzini
Publisher :
ISBN 13 :
Total Pages : 46 pages
Book Rating : 4.:/5 (13 download)

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Book Synopsis An Experimental Study on Sequential Auctions with Privately Known Capacities by : Luca Corazzini

Download or read book An Experimental Study on Sequential Auctions with Privately Known Capacities written by Luca Corazzini and published by . This book was released on 2017 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: We experimentally study bidding behavior in sequential first-price procurement auctions where bidders' capacity constraints are private information. Treatment differs in the ex-ante probability distribution of sellers' capacities and in the (exogenous) probability that the second auction is actually implemented. Our results show that: (i) bidding behavior in the second auction conforms with sequential rationality; (ii) while first auction's bids negatively depend on capacity, bidders seem unable to recognize this link when, at the end of the first auction, they state their beliefs on the opponent's capacity. To rationalize this inconsistency between bids and beliefs, we conjecture that bidding in the first auction is also affected by a hidden, behavioral type - related to the strategic sophistication of bidders - that obfuscates the link between capacity and bids. Building on this intuition, we show that a simple level-k model may help explain the inconsistency.

Essays in Three Design Issues in Experimental Auctions

Author : Ji Yong Lee
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (959 download)

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Book Synopsis Essays in Three Design Issues in Experimental Auctions by : Ji Yong Lee

Download or read book Essays in Three Design Issues in Experimental Auctions written by Ji Yong Lee and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The objective of this thesis is to investigate three design issues in experimental auctions: 1) the effects of allowing negative bids for a privately valued good, 2) the effects of introducing additional alternatives (substitutes) for the auctioned good in an endowment auction, and 3) respondent behavior in acquiring information. The thesis consists of three papers examining those issues. The first paper examines participants bidding behavior when negative bids are allowed for privately valued goods in an experimental auction. We focus on two questions: i) whether subjects with negative values tend to bid strategically - either overbidding or underbidding in an effort to enhancing earnings, and ii) the performance of random nth and 5th price auctions. We find that: a) WTP bids are demand revealing, b) subjects tend to underbid WTA values, c) controlling for risk attitude partially explains the bias in WTA bids, and d) negative values from random nth auctions tend to be below those from 5th price auctions. In the second paper we 1) investigate the effect of the availability of varying numbers of alternatives (substitutes) for a privately valued good on participants bidding behavior, and 2) identify whether the availability of additional alternatives: a) impacts the value of product information, and b) impacts the effect of new information on product valuations. We find that: a) allowing additional alternatives in a private value auction does not significantly decrease subjects bids, and b) the presence of additional alternatives in the auction decreases both the value and effect of product information. The third paper examines the effect of acquired information on auction participants bidding behavior. We focus on three questions: i) how subjects choose/value different types of information, ii) whether the value of acquired information about a product influences the subsequent valuation of the product itself, and iii) whether the effects of acquired information differ from those of exogenously provided information. We find that: a) subjects behaviors of acquiring different types of information about the product are influenced by their heterogeneous characteristics (i.e. prior beliefs, risk attitudes, prior knowledge, etc.), b) subjects place more weight on acquired information than on provided information in their decision-making process, and c) individual subjects have different values of information which caused different impacts on product valuation.

Buyer Behavior in a Multi Object Sequential Auction

Author : Penny Burns
Publisher :
ISBN 13 :
Total Pages : 17 pages
Book Rating : 4.:/5 (93 download)

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Book Synopsis Buyer Behavior in a Multi Object Sequential Auction by : Penny Burns

Download or read book Buyer Behavior in a Multi Object Sequential Auction written by Penny Burns and published by . This book was released on 1981 with total page 17 pages. Available in PDF, EPUB and Kindle. Book excerpt:

On the Timing of Auctions

Author : Alex Arsenault Morin
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis On the Timing of Auctions by : Alex Arsenault Morin

Download or read book On the Timing of Auctions written by Alex Arsenault Morin and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper empirically explores how varying the timing of a sequence of auctions affects both bidder behavior and the welfare of procurers and bidders. We develop a structural auction model with endogenous participation in which bidding may be either simultaneous or sequential, and bidders may perceive auctioned objects as either complements or substitutes. We then apply this model to data on auctions for roof-maintenance projects in Montreal. We show that complementarities can account for as high as 17% of the total size of a contract combination. Finally, we develop an algorithm to search a schedule of auctions and show that the total cost of projects can be reduced by more than 8%.

Common Value Auctions and the Winner's Curse

Author : John H. Kagel
Publisher : Princeton University Press
ISBN 13 : 0691218951
Total Pages : 419 pages
Book Rating : 4.6/5 (912 download)

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Book Synopsis Common Value Auctions and the Winner's Curse by : John H. Kagel

Download or read book Common Value Auctions and the Winner's Curse written by John H. Kagel and published by Princeton University Press. This book was released on 2021-04-13 with total page 419 pages. Available in PDF, EPUB and Kindle. Book excerpt: An invaluable account of how auctions work—and how to make them work Few forms of market exchange intrigue economists as do auctions, whose theoretical and practical implications are enormous. John Kagel and Dan Levin, complementing their own distinguished research with papers written with other specialists, provide a new focus on common value auctions and the "winner's curse." In such auctions the value of each item is about the same to all bidders, but different bidders have different information about the underlying value. Virtually all auctions have a common value element; among the burgeoning modern-day examples are those organized by Internet companies such as eBay. Winners end up cursing when they realize that they won because their estimates were overly optimistic, which led them to bid too much and lose money as a result. The authors first unveil a fresh survey of experimental data on the winner's curse. Melding theory with the econometric analysis of field data, they assess the design of government auctions, such as the spectrum rights (air wave) auctions that continue to be conducted around the world. The remaining chapters gauge the impact on sellers' revenue of the type of auction used and of inside information, show how bidders learn to avoid the winner's curse, and present comparisons of sophisticated bidders with college sophomores, the usual guinea pigs used in laboratory experiments. Appendixes refine theoretical arguments and, in some cases, present entirely new data. This book is an invaluable, impeccably up-to-date resource on how auctions work--and how to make them work.

Handbook of Spectrum Auction Design

Author : Martin Bichler
Publisher : Cambridge University Press
ISBN 13 : 1107135346
Total Pages : 935 pages
Book Rating : 4.1/5 (71 download)

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Book Synopsis Handbook of Spectrum Auction Design by : Martin Bichler

Download or read book Handbook of Spectrum Auction Design written by Martin Bichler and published by Cambridge University Press. This book was released on 2017-10-26 with total page 935 pages. Available in PDF, EPUB and Kindle. Book excerpt: An international team of experts covers the pros and cons of different auction formats and lessons learned in the field.

Rings in Auctions

Author : Angelo Artale
Publisher : Springer Science & Business Media
ISBN 13 : 3642591582
Total Pages : 176 pages
Book Rating : 4.6/5 (425 download)

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Book Synopsis Rings in Auctions by : Angelo Artale

Download or read book Rings in Auctions written by Angelo Artale and published by Springer Science & Business Media. This book was released on 2012-12-06 with total page 176 pages. Available in PDF, EPUB and Kindle. Book excerpt: In auctions, bidders compete with one another in their attempt to 1 purchase the goods that are up for sale • But buyer competition may be reduced or disappear when a ring of colluding bidders is present. The purpose of the participants to a ring is to eliminate buyer competition and to realize a gain over vendors. When all participants are members of the ring, this is done by purchasing the item at the reserve price and splitting the spoils (the difference between the item market value and the reserve price) among the participants. "The term ring apparently derives from the fact that in a settlement sale following the auction, members of the collusive arrangement form a circle or ring to facilitate observation of their trading behavior by the ring leader" (Cassady jr. (1967)). If the coalition members knew other players' values, the problem faced by the ring might be easily solved: the player with the highest value should submit a serious bid and the other members, on the contrary, only phony bids. However, ring participants do not usually know the values of other members. Therefore, ring members have to find out some mechanism which selects the player who has to bid seriously and, eventually, esta blish side payments paid to each of the losers2.

Experimental Auctions

Author : Jayson L. Lusk
Publisher : Cambridge University Press
ISBN 13 : 9780521671248
Total Pages : 316 pages
Book Rating : 4.6/5 (712 download)

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Book Synopsis Experimental Auctions by : Jayson L. Lusk

Download or read book Experimental Auctions written by Jayson L. Lusk and published by Cambridge University Press. This book was released on 2007-11-08 with total page 316 pages. Available in PDF, EPUB and Kindle. Book excerpt: Economists, psychologists, and marketers are interested in determining the monetary value people place on non-market goods for a variety of reasons: to carry out cost-benefit analysis, to determine the welfare effects of technological innovation or public policy, to forecast new product success, and to understand individual and consumer behavior. Unfortunately, many currently available techniques for eliciting individuals' values suffer from a serious problem in that they involve asking individuals hypothetical questions about intended behavior. Experimental auctions circumvent this problem because they involve individuals exchanging real money for real goods in an active market. This represents a promising means for eliciting non-market values. Lusk and Shogren provide a comprehensive guide to the theory and practice of experimental auctions. It will be a valuable resource to graduate students, practitioners and researchers concerned with the design and utilization of experimental auctions in applied economic and marketing research.

Sequential Auctions with Continuation Costs

Author : Richard Engelbrecht-Wiggans
Publisher :
ISBN 13 :
Total Pages : 32 pages
Book Rating : 4.:/5 (318 download)

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Book Synopsis Sequential Auctions with Continuation Costs by : Richard Engelbrecht-Wiggans

Download or read book Sequential Auctions with Continuation Costs written by Richard Engelbrecht-Wiggans and published by . This book was released on 1993 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Sequential Auctions with Capacity Constraints

Author : Isabelle Brocas
Publisher :
ISBN 13 :
Total Pages : 30 pages
Book Rating : 4.:/5 (9 download)

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Book Synopsis Sequential Auctions with Capacity Constraints by : Isabelle Brocas

Download or read book Sequential Auctions with Capacity Constraints written by Isabelle Brocas and published by . This book was released on 2015 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: We conduct a laboratory experiment where groups of 4 subjects constrained to obtain at most one good each, sequentially bid for 3 goods in first and second price auctions. Subjects learn at the beginning of each auction their valuation for the good and exit the auction once they have obtained one good. We show that, contrary to equilibrium predictions, subjects' bidding behavior is excessively similar across units and across mechanisms at the aggregate level. We provide two (complementary) explanations for these departures. One is bounded rationality. Subjects do not fully comprehend subtle differences between mechanisms. The other is self-selection. Subjects are very heterogeneous and some of them deviate more from equilibrium than others. Since deviations take mostly the form of overbidding, these subjects win the first or second good and exit the auction, leaving those who play closer to theoretical predictions to bid for the third good. Support for this hypothesis comes from the documented higher bidding, lower efficiency and lower profits associated with the first and second unit compared to the third one.