Regret under different auction designs: the case of English and Dutch auctions

Ninoslav Malekovic, Lazaros Goutas (), Juliana Sutanto and Dennis Galletta
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Ninoslav Malekovic: Hague Centre for Strategic Studies
Lazaros Goutas: Loughborough University
Juliana Sutanto: Lancaster University
Dennis Galletta: PITT - University of Pittsburgh - Pennsylvania Commonwealth System of Higher Education (PCSHE)

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Abstract: Studies have shown that users experience regret in online electronic auctions. Our study adds to the research on the antecedents of regret by examining the effects of the major types of auction design on users' experience of regret. Towards this goal, we analyzed bidders' experience of regret in English and Dutch auctions. Given that English and Dutch auctions are known to produce different types of bidding behavior and outcomes, we expect that the two types of auction design will also have a differential impact on experiencing regret. We report results from a lab experiment that was implemented as a self-developed mobile application for hotel room reservations. We examined the effects of the two open-bid auction types on the experience of regret, and found that users are more likely to experience regret in Dutch auctions. We point out the theoretical relevance and practical implications of our findings.

Keywords: Regret; Online auctions; Open ascending-bid auction; Open descending-bidauction; English auction; Dutch auction (search for similar items in EconPapers)
Date: 2020-03
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Published in Electronic Markets, 2020, 30 (1), pp.151-161. ⟨10.1007/s12525-019-00355-w⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05008015

DOI: 10.1007/s12525-019-00355-w

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