Efficiency in Second-Price Auctions: A New Look at Old Data

Garratt, RJ; Wooders, J

Efficiency in Second-Price Auctions: A New Look at Old Data

Garratt, RJ Wooders, J

Permalink

Publication Type:: Journal Article
Citation:: Review of Industrial Organization, 2010, 37 (1), pp. 43 - 50
Issue Date:: 2010-07-15

Closed Access

	Filename	Description	Size
	2010005891OK.pdf		280.48 kB	Adobe PDF	View/Open

Copyright Clearance Process

Recently Added
In Progress
Closed Access

This item is closed access and not available.

Full metadata record

Field	Value	Language
dc.contributor.author	Garratt, RJ	en_US
dc.contributor.author	Wooders, J https://orcid.org/0000-0002-4206-7137	en_US
dc.date.issued	2010-07-15	en_US
dc.identifier.citation	Review of Industrial Organization, 2010, 37 (1), pp. 43 - 50	en_US
dc.identifier.issn	0889-938X	en_US
dc.identifier.uri	http://hdl.handle.net/10453/15734
dc.description.abstract	Experiments on second-price sealed-bid private value auctions have established that subjects typically bid more than their value, despite the fact that value bidding is a dominant strategy in such auctions. Moreover, the laboratory evidence shows that subjects do not learn to bid their values as they gain more experience. In the present paper, we re-examine the second-price auction data from Kagel and Levin's (Econ J 103:868-879, 1993) classic paper. We find that auction efficiency increases over time, even though the frequency of overbidding is unchanged. We argue that the rise in efficiency is due to a decline in the variability of overbidding. This is consistent with subjects' learning to bid more like each other. © 2010 The Author(s).	en_US
dc.relation.ispartof	Review of Industrial Organization	en_US
dc.relation.isbasedon	10.1007/s11151-010-9255-7	en_US
dc.subject.classification	Economics	en_US
dc.title	Efficiency in Second-Price Auctions: A New Look at Old Data	en_US
dc.type	Journal Article
utslib.citation.volume	1	en_US
utslib.citation.volume	37	en_US
utslib.for	1402 Applied Economics	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Economics Discipline
utslib.copyright.status	closed_access
pubs.issue	1	en_US
pubs.publication-status	Published	en_US
pubs.volume	37	en_US

Abstract:

Experiments on second-price sealed-bid private value auctions have established that subjects typically bid more than their value, despite the fact that value bidding is a dominant strategy in such auctions. Moreover, the laboratory evidence shows that subjects do not learn to bid their values as they gain more experience. In the present paper, we re-examine the second-price auction data from Kagel and Levin's (Econ J 103:868-879, 1993) classic paper. We find that auction efficiency increases over time, even though the frequency of overbidding is unchanged. We argue that the rise in efficiency is due to a decline in the variability of overbidding. This is consistent with subjects' learning to bid more like each other. © 2010 The Author(s).

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/15734