Asymmetric auctions with resale: An experimental study

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Georganas, S. ; Kagel, J. H. (2011)
  • Publisher: Elsevier
  • Related identifiers: doi: 10.1016/j.jet.2010.12.001
  • Subject: HB
    acm: TheoryofComputation_GENERAL | TheoryofComputation_MISCELLANEOUS

We study auctions with resale based on Hafalir and Krishna's (2008) [6] model. As predicted, weak bidders bid more with resale than without, so that average auction prices tend to increase. When the equilibrium calls for weak types to bid higher than their values with resale they do, but not nearly as much as the theory predicts. In other treatments outcomes are much closer to the risk neutral Nash model's predictions. Bid distributions for weak and strong types are more similar with resale than without, in line with the theory.
  • References (10)

    [1] Garratt, Rod and T. Troeger (2006) "Speculation in Standard Auctions with Resale" Econometrica 74, 753-769.

    [2] Georganas, Sotiris (2003) "Auctions with Resale: An Experimental Study", masters thesis, University of Bonn

    [3] Guth, Werner, Radosveta Ivanova-Stenzel and Elmar Wolfstetter, (2005). "Bidding behavior in asymmetric auctions: An experimental study," European Economic Review, Elsevier, vol. 49(7), pages 1891-1913, October.

    [4] Hafalir, Isa Emin and Vijay Krishna, "Asymmetric Auctions with Resale", (2008). American Economic Review

    [5] Hafalir, Isa Emin and Vijay Krishna, "Revenue and Efficiency Effects of Resale in First-Price Auctions", (2009). Journal of Mathematical Economics

    [6] Haile, Philip A. (2000) "Partial Pooling at the Reserve Price in Auctions with Resale Opportunities," Games and Economic Behavior, Elsevier, vol. 33(2), pages 231-248, November.

    [7] Haile, Philip A. (2001) "Auctions with Resale Markets: An Application to U.S. Forest Service Timber Sales" American Economic Review, vol. 91, issue 3, pages 399-427

    [8] Haile, Philip A. (2003) "Auctions with private uncertainty and resale opportunities", Journal of Economic Theory 108, 72-110

    [9] Lange, Andreas, John A. List, Michael K. Price (2004) "Auctions with Resale When Private Values Are Uncertain: Theory and Empirical Evidence", NBER Working Paper No. w10639

    [10] Plum, M, (1992). "Characterization and Computation of Nash-Equilibria for Auctions with Incomplete Information," International Journal of Game Theory, Springer, vol. 20(4), pages 393-418.

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