Comparing Open and Sealed Bid Auctions: Evidence from Timber Auctions

Susan Athey, Jonathan Levin and Enrique Seira

No 14590, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study entry and bidding patterns in sealed bid and open auctions with heterogeneous bidders. Using data from U.S. Forest Service timber auctions, we document a set of systematic effects of auction format: sealed bid auctions attract more small bidders, shift the allocation towards these bidders, and can also generate higher revenue. We show that a private value auction model with endogenous participation can account for these qualitative effects of auction format. We estimate the model's parameters and show that it can explain the quantitative effects as well. Finally, we use the model to provide an assessment of bidder competitiveness, which has important consequences for auction choice.

JEL-codes: D44 D82 L13 L40 (search for similar items in EconPapers)
Date: 2008-12
New Economics Papers: this item is included in nep-com and nep-gth
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Citations: View citations in EconPapers (12)

Published as Susan Athey & Jonathan Levin & Enrique Seira, 2011. "Comparing open and Sealed Bid Auctions: Evidence from Timber Auctions," The Quarterly Journal of Economics, Oxford University Press, vol. 126(1), pages 207-257.

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Related works:
Journal Article: Comparing open and Sealed Bid Auctions: Evidence from Timber Auctions (2011)
Working Paper: Comparing Open and Sealed Bid Auctions: Evidence from Timber Auctions (2008)
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