Competition and cooperation in divisible good auctions: An experimental examination

    Authors

    O. Sade; C. Schnitzlein;J. F. Zender

    Comments

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    Abbreviated Journal Title

    Rev. Financ. Stud.

    Keywords

    Business, Finance; Economics

    Abstract

    An experimental approach is used to examine the performance of three different multiunit auction designs: discriminatory, uniform-price with fixed supply, and uniform-price with endogenous supply. We find the actual strategies to be inconsistent with theoretically identified equilibrium strategies. The discriminatory auction is found to be more susceptible to collusion than either uniform-price auction and so, contrary to theoretical predictions and previous experimental results, it generates the lowest average revenue. Consistent with theoretical predictions, the actual bid schedules are more elastic with reducible supply or discriminatory pricing than in the uniform-price auction with fixed supply.

    Journal Title

    Review of Financial Studies

    Volume

    19

    Issue/Number

    1

    Publication Date

    1-1-2006

    Document Type

    Article

    Language

    English

    First Page

    195

    Last Page

    235

    WOS Identifier

    WOS:000234218200006

    ISSN

    0893-9454

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