Intimidation or Impatience? Jump Bidding in On-line Ascending Automobile Auctions

David Grether, David Porter and Matthew Shum ()

Working Papers from Chapman University, Economic Science Institute

Abstract: We run a large field experiment with an online company specializing in selling used automobiles via ascending auctions. We manipulate experimentally the maximum amount which bidders can bid above the current standing price, thus affecting the ease with which bidders can engage in jump bidding. We test between the intimidation vs. costly bidding hypotheses of jump bidding by looking at the effect of these jump-bidding restrictions on average seller revenue. We find evidence consistent with costly bidding in one market (Texas), but intimidation in the other market (New York). This difference in findings between the two markets appears partly attributable to the more prominent presence of sellers who are car dealers in the Texas market.

Pages: 33 pages
Date: 2011
New Economics Papers: this item is included in nep-exp
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:chu:wpaper:11-07

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