On (mis-)perception of probabilities in first-price sealed-bid auctions

Zeynep Kantur () and Kerim Keskin

Economics Bulletin, 2019, vol. 39, issue 1, 726-733

Abstract: We study a two-stage probability weighting model [see Tversky and Fox, 1995] in a first-price sealed-bid auction. We present the unique symmetric equilibrium and provide some experimental support for our model.

Keywords: First-price auctions; Overbidding; Probability misperception; Subjective probability weighting (search for similar items in EconPapers)
JEL-codes: C7 D8 (search for similar items in EconPapers)
Date: 2019-03-28
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