Decision-making in Home-grown Value Auctions under Induced Mood States

Andreas Drichoutis, Rodolfo Nayga and Stathis Klonaris ()

Studies in Microeconomics, 2014, vol. 2, issue 2, 141-163

Abstract: This article contributes to the research agenda of accommodating psychological insights in conventional lab experiments. We specifically test whether inducing subjects into different mood states has a significant effect on subjects’ rationality (in the form of preference reversals) and on bidding behaviour in home-grown value auctions. We find that mood states can significantly affect the rate of preference reversals and bidding behaviour in experimental auction valuation. Specifically we find that subjects under a positive mood state exhibit more rational behaviour (i.e., less preference reversals) and provide lower bid values than others.

Keywords: Mood; affect; rationality; Vickrey auction; preference reversals (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:sae:miceco:v:2:y:2014:i:2:p:141-163

DOI: 10.1177/2321022214545270

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