Irrationality in English auctions

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Rationality, Irrationality and Escalating Behavior in Lowest Unique Bid Auctions

Information technology has revolutionized the traditional structure of markets. The removal of geographical and time constraints has fostered the growth of online auction markets, which now include millions of economic agents worldwide and annual transaction volumes in the billions of dollars. Here, we analyze bid histories of a little studied type of online auctions--lowest unique bid auctions...

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Rationality, irrationality and escalating behavior in online auctions

Filippo Radicchi,1 Andrea Baronchelli,2 and Luís A. N. Amaral1, 3, 4 Howard Hughes Medical Institute (HHMI), Northwestern University, Evanston, Illinois 60208 USA Departament de Física i Enginyeria Nuclear, Universitat Politècnica de Catalunya, Campus Nord B4, 08034 Barcelona, Spain Department of Chemical and Biological Engineering, Northwestern University, Evanston, Illinois 60208 USA Northwes...

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Buy prices in online auctions : irrationality on the internet ? *

Buy prices are puzzling: it makes sense for a seller at auction to set a minimum bidding level (i.e., a reserve price), surely, but a maximum? We explore the use of maximum bidding levels (buy prices) in online auctions and provide a rational explanation for this seemingly irrational auction mechanism. We show that augmenting an English auction with a buy price can improve the seller’s profits ...

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Shill Bidding in English Auctions

Shill bidding in English auction is the deliberate placing bids on the seller’s behalf to artificially drive up the price of his auctioned item. Shill bidding has been known to occur in auctions of high-value items like art and antiques where bidders’ valuations differ and the seller’s payoff from fraud is high. We prove that privatevalue English auctions with shill bidding can result in a high...

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Secure Online English Auctions

Security and privacy in online auctions is a major concern as auction participants have many opportunities to cheat (e.g., repudiate bids, not deliver items, etc.). Online auctions such as those used by eBay are based on a type of auction referred to as an English auction. Dispite the English auction being the most popular type of auction, it has received less security coverage than other types...

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ژورنال

عنوان ژورنال: Journal of Economic Behavior & Organization

سال: 2008

ISSN: 0167-2681

DOI: 10.1016/j.jebo.2006.10.002