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If prizes are to be awarded simultaneously at a specified time on a first-come-firstserved basis, then individuals who queue for them will choose different waiting times through their arrivals at the queue. This choice of arrival time at a queue is similar to the choice of a sealed tender in an auction. An equilibrium for this "waiting-line auction" is obtained here using methods for analyzing sealed-tender auctions. When individuals are risk neutral it is shown that several alternative waiting-line allocation procedures result in the same transactions cost associated with waiting in line.
Sellers selected both price and quality but buyers had limited information about those choices in the experiments reported here. Market efficiency was high under full information with truthful advertising of prices and qualities, but was much lower with no advertising of price or quality. Efficiency did not improve when sellers were permitted to advertise price, but not quality, and in half of these experiments “lemons” outcomes occurred. Although the range of outcomes is great, it cannot be claimed that price advertising improves efficiency when quality is unknown.
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