The Sealed-Bid Abstraction in Online Auctions

Zeithammer, Robert; Adams, Christopher

doi:10.2139/ssrn.1028063

Cited by 16 publications

(30 citation statements)

References 34 publications

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“…However, it should be noted that the Song estimator is only an unbiased estimator of the value distribution if bidders behave as if they are in a sealed-bid auction. Zeithammer and Adams (2010) test this hypothesis and find the assumption does not generally hold. Again, the estimator may be a biased estimate of the median of the valuation distribution, but is still valid for testing the hypothesis if bidder behavior is unrelated to the length of the auction.…”

Section: Winner's Cursementioning

confidence: 99%

Vettes and lemons on eBay

2011

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Section: Winner's Cursementioning

confidence: 99%

Vettes and lemons on eBay

2011

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“…Second, our identification arguments do not require data on eBay proxy bids. As noted by Zeithammer and Adams (2010) among others, these bids may be hard to interpret on eBay. We investigate many of these and other issues in our ongoing empirical work on eBay's Buy-it-Now auctions (Ackerberg, Hirano, and Shahriar (2006)).…”

Section: Ebay's Buy-it-now Auctionsmentioning

confidence: 99%

“…Our single-unit theoretical model in Section 2 also embodies an assumption that there are no other auctions, either simultaneously or in the future. This is often assumed in the auction literature (with some notable exceptions, e.g., Jofre-Bonet and Pesendorfer (2003), Zeithammer (2006Zeithammer ( , 2007Zeithammer ( , 2010, Nekipelov (2008), Zeithammer and Adams (2010), and Backus and Lewis (2016)), but it may be questionable for some product categories on eBay and similar markets.…”

Section: Identificationmentioning

confidence: 99%

“… See Haile and Tamer (2003),Bajari and Hortacsu (2005),Song (2004),Adams (2004Adams ( , 2007Adams ( , 2009),Gonzales, Hasker, and Sickles (2004), Canals-Cerda and Pearcy (2013),Nekipelov (2008),Zeithammer and Adams (2010), andBackus and Lewis (2016), among others Athey and Haile (2007). survey identification results for auction models.…”

mentioning

confidence: 99%

“…Depending on the context, bids may only provide bounds on valuations(Haile and Tamer (2003),Zeithammer and Adams (2010)). …”

mentioning

confidence: 99%

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Identification of time and risk preferences in buy price auctions

Ackerberg

Hirano

Shahriar

2017

Quantitative Economics

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Buy price auctions merge a posted price option with a standard bidding mechanisms, and have been used by various online auction sites including eBay and General Motors Assistance Corporation. A buyer in a buy price auction can accept the buy price to win with certainty and end the auction early. Intuitively, the buy price option may appeal to bidders who are risk averse or impatient to obtain the good, and a number of authors have examined how such mechanisms can increase the seller's expected revenue over standard auctions. We show that data from buy price auctions can be used to identify bidders' risk aversion and time preferences. We develop a private value model of bidder behavior in a buy price auction with a temporary buy price. Bidders arrive stochastically over time, and the auction proceeds as a second‐price sealed bid auction after the buy price disappears. Upon arrival, a bidder in our model is allowed to act immediately (i.e., accept the buy price if it is still available or place a bid) or wait and act later. Allowing for general forms of risk aversion and impatience, we first characterize equilibria in cutoff strategies and describe conditions under which all symmetric pure‐strategy subgame‐perfect Bayesian Nash equilibria are in cutoff strategies. Given sufficient exogenous variation in auction characteristics such as reserve and buy prices and in auction lengths, we then show that the arrival rate, valuation distribution, utility function, and time‐discounting function in our model are all nonparametrically identified. We also develop extensions of the identification results for cases where the variation in auction characteristics is more limited.

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Reserve price and competing bids: Reference points for product evaluations in online auctions?

Trautmann

Kuilen

2015

J of Consumer Behaviour

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With an increasing number of products sold in online auctions, the effect of reference points on consumers' product valuations has received much attention in the literature. Two potentially relevant factors affecting bidders' preferences are the sellers' reserve price and the competing bids by other bidders. The current evidence regarding these reference points is mixed. We argue that a focus on studying bids prevents a clear identification of reference point effects. Directly observing product valuations, in two experiments, we find that willingness to pay in online auctions is affected by both reserve prices and competing bids, supporting the constructed values paradigm. Copyright © 2015 John Wiley & Sons, Ltd.

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The Sealed-Bid Abstraction in Online Auctions

Cited by 16 publications

References 34 publications

Vettes and lemons on eBay

Vettes and lemons on eBay

Identification of time and risk preferences in buy price auctions

Reserve price and competing bids: Reference points for product evaluations in online auctions?

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