Multiple Items, Ascending Price Auctions: An Experimental Examination of Alternative Auction Sequences
Abstract
The paper investigates the revenue and efficiency of different ascending price auction architectures for the sale of three items and five bidders. Four architectures are studied: two different sequences of single item auctions, simultaneous auctions with a common countdown clock, and simultaneous auctions with item specific countdown clocks. A countdown clock measures the time until the auction closes but resets with each new bid. The environment contains independent private values, no uncertainty about own preferences, no information about other's preferences, and a one unit budget constraint. The Nash equilibrium best response with straight forward bidding fits both dynamic and outcome data well. When non-unique Nash equilibria exist as in the case of simultaneous markets with a common clock, the social value maximizing Nash equilibrium emerges as the equilibrium selection. Both total revenue and efficiencies depend on the architecture as predicted by the Nash model, with the exception of the independent clocks architecture, which performs poorly on all dimensions.
Additional Information
The financial support of the Gordon and Betty Moore Foundation is gratefully acknowledged. Special acknowledgement is given to class members Sarah Brandsen, Wen Min Chen, Rebecca Hu, and Emily Jensen who contributed to the early development of the research. We thank Matthew Elliot, Ben Gillen, Dave Grether, Katrina Scherstyuk, Kirill Pogorelskiy, Fabio Michelucci and Robert Sherman for their many helpful comments.Attached Files
Accepted Version - sswp1406.pdf
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Additional details
- Eprint ID
- 64638
- Resolver ID
- CaltechAUTHORS:20160222-134834747
- Gordon and Betty Moore Foundation
- Created
-
2016-03-02Created from EPrint's datestamp field
- Updated
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2020-03-09Created from EPrint's last_modified field
- Caltech groups
- Social Science Working Papers
- Series Name
- Social Science Working Paper
- Series Volume or Issue Number
- 1406