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Private Valuation of a Public Good in Three Auction Mechanisms

Arnaud Dragicevic and David Ettinger ()

CIRANO Working Papers from CIRANO

Abstract: We evaluate the impact of three auction mechanisms the BeckerDeGrootMarschak (BDM) mechanism, the second-price auction, and the random nth-price auction in the measurement of private willingness-to-pay and willingness-to-accept for a pure public good. Our results show that the endowment effect can be eliminated with repetitions of the BDM mechanism. Yet, on a logarithmic scale, the random nth-price auction yields the highest speed of convergence to welfare indices' equality. Overall, we observe that subjects value public goods in reference to their private subjective benefit derived from the public good funding. Nous évaluons l'impact de trois mécanismes d'enchère le mécanisme Becker-DeGroot-Marschak (BDM), l'enchère au deuxième prix, et l'enchère aléatoire au nième prix dans l'évaluation des consentement-à-payer et consentement-à-recevoir privés d'un bien public pur. Nos résultats montrent que l'effet de dotation peut être éliminé en répétant le mécanisme BDM. Néanmoins, à l'échelle logarithmique, l'enchère aléatoire au nième prix donne la vitesse de convergence vers l'égalité des indices de bien-être la plus élevée. Plus généralement, nous observons que les sujets d'étude évaluent les biens publics en se référant à l'avantage privé et subjectif qui résulte du financement du bien public.

Keywords: Contingent valuation; WTP-WTA gap; auctions; public good private supply; évaluation contingente; Ecart CAP-CAR; enchères; provision privée des biens publics (search for similar items in EconPapers)
JEL-codes: C91 D44 Q53 (search for similar items in EconPapers)
Date: 2010-01-01
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Related works:
Journal Article: Private Valuation of a Public Good in Three Auction Mechanisms (2011) Downloads
Journal Article: Private Valuation of a Public Good in Three Auction Mechanisms (2011) Downloads
Working Paper: Private Valuation of a Public Good in Three Auction Mechanisms (2011) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:cir:cirwor:2010s-04

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