Revealing Consumers\' Willingness-To-Pay: A Comparison of the BDM Mechanism and the Vickrey Auction

Charles N. Noussair, Stephane Robin and Bernard Ruffieux

No 2002-01, Experimental Economics Center Working Paper Series from Experimental Economics Center, Andrew Young School of Policy Studies, Georgia State University

Abstract: We compare the capability of the Becker-DeGroot-Marschak mechanism and the Vickrey auction to reveal willingness-to-pay information for a sample of French consumers. We measure the bias and dispersion of bids relative to valuations. We find that the Vickrey auction, for the particular training procedure we employ, is more effective as a willingness-to-pay elicitation device than the BDM process. We conjecture that differences in the shape of the payoff function account for some of the differences.

Keywords: Consumer Behaviour; Willingness-to-pay; Auction (search for similar items in EconPapers)
JEL-codes: C90 (search for similar items in EconPapers)
Pages: 31
Date: 2002-03
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Persistent link: https://EconPapers.repec.org/RePEc:exc:wpaper:2002-01

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