The spite motive in third price auctions
Wladislaw Mill ()
Economics Letters, 2017, vol. 161, issue C, 71-73
A spiteful agent losing an auction experiences negative emotions towards the winner. In line with previous experimental findings I show that the symmetric equilibrium bid of a spiteful agent in third price auctions is higher than the risk neural Nash equilibrium bid. Furthermore, it can be shown that spiteful agents bid the same way agents would who anticipate to regret their decision in equilibrium.
Keywords: Auction; Overbidding; Spite; Anticipated regret (search for similar items in EconPapers)
JEL-codes: C72 D44 D81 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:161:y:2017:i:c:p:71-73
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