Vickrey Auction vs BDM: Difference in bidding behaviour and the impact of other-regarding motives

Niall Flynn (), Christopher Kah () and Rudolf Kerschbamer

Working Papers from Faculty of Economics and Statistics, Universität Innsbruck

Abstract: In an experiment we first elicit the distributional preferences of subjects and then let them bid for a lottery, either in a Becker-DeGroot-Marschak (BDM) mechanism or a Vickrey auction (VA). Standard theory predicts that altruistic subjects underbid in the VA -- compared to the BDM -- while spiteful subjects overbid in the VA. The data do not confirm those predictions. While we observe aggregate underbidding in the VA, the result is not driven by the choices of altruistic subjects.

Keywords: Distributional preferences; BDM; Vickrey auction (search for similar items in EconPapers)
JEL-codes: C72 C91 (search for similar items in EconPapers)
Pages: 14 pages
Date: 2015-12
New Economics Papers: this item is included in nep-exp and nep-upt
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Related works:
Journal Article: Vickrey auction vs BDM: difference in bidding behaviour and the impact of other-regarding motives (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:inn:wpaper:2015-16

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