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dc.contributor.authorDavis, Andrew M.en_US
dc.contributor.authorKatok, Elenaen_US
dc.contributor.authorKwasnica, Anthony M.en_US
dc.date.accessioned2014-09-10T22:08:46Z
dc.date.available2014-09-10T22:08:46Z
dc.date.created2014-04en_US
dc.identifier.issn0025-1909en_US
dc.identifier.urihttp://hdl.handle.net/10735.1/4001
dc.descriptionSupplementary data available online from the publisher.en_US
dc.description.abstractWhen bidders incur a cost to learn their valuations, bidder entry can impact auction performance. Two common selling mechanisms in this environment are an English auction and a sequential bidding process. Theoretically, sellers should prefer the auction, because it generates higher expected revenues, whereas bidders should prefer the sequential mechanism, because it generates higher expected bidder profits. We compare the two mechanisms in a controlled laboratory environment, varying the entry cost, and find that, contrary to the theoretical predictions, average seller revenues tend to be higher under the sequential mechanism, whereas average bidder profits are approximately the same. We identify three systematic behavioral deviations from the theoretical model: (1) in the auction, bidders do not enter 100% of the time; (2) in the sequential mechanism, bidders do not set preemptive bids according to the predicted threshold strategy; and (3) subsequent bidders tend to overenter in response to preemptive bids by first bidders. We develop a model of noisy bidder-entry costs that is consistent with these behaviors, and we show that our model organizes the experimental data well.en_US
dc.language.isoenen_US
dc.publisherInformsen_US
dc.relation.urihttp://dx.doi.org/10.1287/mnsc.2013.1800en_US
dc.rights©2014 INFORMSen_US
dc.subjectCompetitive biddingen_US
dc.subjectAuctionsen_US
dc.subjectRisken_US
dc.subjectExperimental economicsen_US
dc.titleShould Sellers Prefer Auctions? A Laboratory Comparison of Auctions and Sequential Mechanismsen_US
dc.type.genrearticleen_US
dc.identifier.bibliographicCitationDavis, Andrew M., Elena Katok, and Anthony M. Kwasnica. 2014. "Should sellers prefer auctions? A laboratory comparison of auctions and sequential mechanisms." Management Science 60(4): 990-1008.en_US
dc.source.journalManagement Scienceen_US
dc.identifier.volume60en_US
dc.identifier.issue4en_US
dc.identifier.startpage990en_US
dc.contributor.ISNI0000 0000 1152 7888 (Katok, E)
dc.contributor.VIAF198160306 (Katok, E)


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