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Multiple and last-minute bidding in competing internet auctions

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  • Marta Stryszowska

Abstract

The present paper proposes a theoretical model of the equilibrium bidding behavior in simultaneous competing private-value Internet auctions such as those on eBay. It shows that last-minute bidding and multiple bidding, two commonly observed bidding strategies, arise in equilibrium. It also suggests that last-minute bidding may lead to inefficient outcomes. Copyright Springer-Verlag Berlin Heidelberg 2013

Suggested Citation

  • Marta Stryszowska, 2013. "Multiple and last-minute bidding in competing internet auctions," Review of Economic Design, Springer;Society for Economic Design, vol. 17(4), pages 273-305, December.
    • Handle: RePEc:spr:reecde:v:17:y:2013:i:4:p:273-305
    DOI: 10.1007/s10058-013-0142-1
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    References listed on IDEAS

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    1. Patrick Bajari & Ali Hortaçsu, 2004. "Economic Insights from Internet Auctions," Journal of Economic Literature, American Economic Association, vol. 42(2), pages 457-486, June.
    2. Peters, Michael & Severinov, Sergei, 2006. "Internet auctions with many traders," Journal of Economic Theory, Elsevier, vol. 130(1), pages 220-245, September.
    3. Krishna, Vijay, 2009. "Auction Theory," Elsevier Monographs, Elsevier, edition 2, number 9780123745071.
    4. Ockenfels, Axel & Roth, Alvin E., 2006. "Late and multiple bidding in second price Internet auctions: Theory and evidence concerning different rules for ending an auction," Games and Economic Behavior, Elsevier, vol. 55(2), pages 297-320, May.
    5. Vulkan, Nir & Roth, Alvin E. & Neeman, Zvika (ed.), 2013. "The Handbook of Market Design," OUP Catalogue, Oxford University Press, number 9780199570515.
    6. Dan Ariely & Axel Ockenfels & Alvin E. Roth, 2005. "An Experimental Analysis of Ending Rules in Internet Auctions," RAND Journal of Economics, The RAND Corporation, vol. 36(4), pages 890-907, Winter.
    7. Kevin Hasker & Robin Sickles, 2010. "eBay in the Economic Literature: Analysis of an Auction Marketplace," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 37(1), pages 3-42, August.
    8. Alvin E. Roth & Axel Ockenfels, 2002. "Last-Minute Bidding and the Rules for Ending Second-Price Auctions: Evidence from eBay and Amazon Auctions on the Internet," American Economic Review, American Economic Association, vol. 92(4), pages 1093-1103, September.
    9. Peitz, Martin & Waldfogel, Joel, 2012. "The Oxford Handbook of the Digital Economy," OUP Catalogue, Oxford University Press, number 9780195397840.
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    Cited by:

    1. Nicola Dimitri, 2022. "Last minute only bidding is implausible in eBay sealed bid type-of-auctions," Electronic Commerce Research, Springer, vol. 22(2), pages 225-239, June.

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    More about this item

    Keywords

    Internet auctions; eBay; Multi-unit auctions; Simultaneous auctions; Last-minute bidding; Sniping; D44;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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