Premium auctions in the field

Sander Onderstal

Review of Economic Design, 2020, vol. 24, issue 1, No 3, 39-63

Abstract: Abstract In a field experiment, we study the revenue-generating properties of premium auctions. In a premium auction, the runner-up obtains a premium for driving up the price paid by the winner. Previous research, both theoretical and in the lab, has shown that the relative performance of premium auctions compared to standard auction formats is context-specific. In the experiment, we compare two types of premium auctions with the standard Vickrey auction selling high-quality, limited-edition posters in an online auction. We observe that neither premium auction raises higher revenue than the Vickrey auction. Revenue dispersion in the Amsterdam auction, one of the premium auctions, is lower than that in the other two auctions.

Keywords: Premium auctions; Vickrey auction; Field experiment (search for similar items in EconPapers)
JEL-codes: C93 D44 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Working Paper: Premium Auctions in the Field (2017)
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DOI: 10.1007/s10058-020-00228-1

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