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Impulse Balance Equilibrium and Feedback in First Price Auctions

Author

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  • Axel Ockenfels
  • Reinhard Selten

Abstract

Experimental sealed-bid first-price auctions with private values in which feedback on the losing bids is provided yield lower revenues than auctions where this feedback is not given. The concept of weighted impulse balance equilibrium, which is based on a principle of ex post rationality and incorporates a concern for social comparison, captures the data.

Suggested Citation

  • Axel Ockenfels & Reinhard Selten, 2004. "Impulse Balance Equilibrium and Feedback in First Price Auctions," Working Paper Series in Economics 7, University of Cologne, Department of Economics.
    • Handle: RePEc:kls:series:0007
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    References listed on IDEAS

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    More about this item

    Keywords

    Auctions; Overbidding; Feedback; Experiments; Ex-post rationality; Bounded rationality; Social comparison;
    All these keywords.

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments

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