A Theory of Jump Bidding in Ascending Auctions

R. Mark Isaac, Tim C. Salmon () and Arthur Louis Zillante ()

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Abstract: Jump bidding is a commonly observed phenomenon that involves bidders in ascending auctions submitting bids higher than required by the auctioneer. Such behavior is typically explained as due to irrationality or to bidders signaling their value. We present field data that suggests such explanations are unsatisfactory and construct an alternative model in which jump bidding occurs due to strategic concerns and impatience. We go on to examine the impact of jump bidding on the outcome of ascending auctions in an attempt to resolve some policy disputes in the design of ascending auctions.

Keywords: auction theory; ascending auctions; jump bidding (search for similar items in EconPapers)
JEL-codes: C9 D44 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com and nep-mic
Date: 2004-04-22
Note: Type of Document - pdf; pages: 29
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http://129.3.20.41/eps/game/papers/0404/0404002.pdf (application/pdf)

Related works:
Journal Article: A theory of jump bidding in ascending auctions (2007)
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpga:0404002

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