Bidding behavior at sequential first-price auctions with(out) supply uncertainty: A laboratory analysis

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2007

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Neugebauer, T.
Pezanis-Christou, P.

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Journal of Economic Behavior and Organization, 2007; 63(1):55-72

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Tibor Neugebauer, Paul Pezanis-Christou

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Abstract

We report on a series of experiments that test the effects of an uncertain supply on bidding behavior and prices in sequential first-price auctions with private-independent values and unit-demands. Supply is assumed uncertain when buyers do not know the exact number of units to be sold (i.e., the length of the sequence). We observe an important overbidding in all but the last stage of a sequence, no matter whether supply is certain, and a non-monotone behavior when supply is certain. Yet, the data qualitatively support most stage-to-stage bid predictions and the price trend predictions for risk neutral bidders. © 2006.

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©2006 Published by Elsevier B.V

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