Economics at your fingertips  

An Empirical Analysis of Double Round Auctions

Jarl G. Kallberg, Crocker H. Liu and Adam Nowak

Real Estate Economics, 2021, vol. 49, issue 2, 531-555

Abstract: This article analyzes auctions that can feature two bidding rounds for the sale of a single good. In the first round, the seller, after analyzing the received bids, may elect to have k bidders rebid. The highest bidder in the second round then acquires the asset at the highest bid price. We use a sample of 67 properties that sold through this auction process. The 40 hotels in this sample are matched to a control group of 157 hotel properties that were sold in the conventional manner in order to develop a hedonic model for “conventional” sale prices. Using this model, we find that the double round auction mechanism increases the seller's expected revenue significantly: Specifically, in our sample, we estimate that the expected value of a double round auction bid is 8.4% higher than the estimated price if the property were sold using traditional methods. In addition, we show that the average bid is not significantly different from the estimated sale price. We further find (controlling for property characteristics) that the average bid increases by 3.7% from the first to the second round.

Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1080-8620

Access Statistics for this article

Real Estate Economics is currently edited by Crocker Liu, N. Edward Coulson and Walter Torous

More articles in Real Estate Economics from American Real Estate and Urban Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().

Page updated 2022-05-07
Handle: RePEc:bla:reesec:v:49:y:2021:i:2:p:531-555