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Collusion or Sniping in simultaneous ascending Auctions

Author

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  • Sascha Füllbrunn

    (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg)

Abstract

In simultaneous ascending price auctions with heterogeneous goods Brusco and Lopomo (2002) derive collusive equilibria where bidders divide objects among themselves, while keeping the prices low. Considering a simultaneous ascending price auction with a fixed deadline, i.e. the Hard Close auction format, a prisoner’s dilemma situation results and collusive equilibria no longer exists, even for only two bidders. Hence, we introduce a further reason for sniping behavior in Hard Close auctions.

Suggested Citation

  • Sascha Füllbrunn, 2007. "Collusion or Sniping in simultaneous ascending Auctions," FEMM Working Papers 07025, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
    • Handle: RePEc:mag:wpaper:07025
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    File URL: http://www.ww.uni-magdeburg.de/fwwdeka/femm/a2007_Dateien/2007_25.pdf
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    References listed on IDEAS

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    1. Sandro Brusco & Giuseppe Lopomo, 2002. "Collusion via Signalling in Simultaneous Ascending Bid Auctions with Heterogeneous Objects, with and without Complementarities," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 69(2), pages 407-436.
    2. Anwar, Sajid & McMillan, Robert & Zheng, Mingli, 2006. "Bidding behavior in competing auctions: Evidence from eBay," European Economic Review, Elsevier, vol. 50(2), pages 307-322, February.
    3. Sascha Füllbrunn & Tibor Neugebauer, 2007. "An experimental investigation of collusion in hard-close auctions: partners and friends," FEMM Working Papers 07024, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
    4. Peters, Michael & Severinov, Sergei, 2006. "Internet auctions with many traders," Journal of Economic Theory, Elsevier, vol. 130(1), pages 220-245, September.
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    6. Sandro Brusco & Giuseppe Lopomo, 2004. "Collusion via Signalling in Simultaneous Ascending Bid Auctions with Heterogeneous Objects, with and without Complementarities," Levine's Bibliography 122247000000000385, UCLA Department of Economics.
    7. Ladislav Wintr, 2008. "Some Evidence On Late Bidding In Ebay Auctions," Economic Inquiry, Western Economic Association International, vol. 46(3), pages 369-379, July.
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    11. Sascha Füllbrunn & Abdolkarim Sadrieh, 2012. "Sudden Termination Auctions—An Experimental Study," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 21(2), pages 519-540, June.
    12. 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.
    13. Anthony M. Kwasnica & Katerina Sherstyuk, 2007. "Collusion and Equilibrium Selection in Auctions," Economic Journal, Royal Economic Society, vol. 117(516), pages 120-145, January.
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    Cited by:

    1. Sascha Fullbrunn & Tibor Neugebauer, 2009. "Anonymity deters collusion in hard-close auctions: experimental evidence," New Zealand Economic Papers, Taylor & Francis Journals, vol. 43(2), pages 131-148.
    2. Sascha Füllbrunn, 2009. "A comparison of Candle Auctions and Hard Close Auctions with Common Values," FEMM Working Papers 09019, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.

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    More about this item

    Keywords

    collusion; sniping; multi unit auctions; prisoner’s dilemma;
    All these keywords.

    JEL classification:

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

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