EconPapers    
Economics at your fingertips  
 

Frictions in Internet Auctions with Many Traders: a Counterexample

Javier Donna, Pablo Schenone and Gregory Veramendi

MPRA Paper from University Library of Munich, Germany

Abstract: Peters and Severinov (2006) (PS henceforth) characterize a perfect Bayesian equilibrium (PBE) in a competing auctions environment, where all buyers are linked to all the sellers. PS characterize a PBE using a simple bidding rule, whereby buyers select in which auction to bid. In this note we show that when buyers are linked with a subset of the sellers (i.e. when there are search frictions), the PS bidding rule is no longer guaranteed to be efficient nor a PBE of the competing auctions game of PS. Our results indicate that researchers should be cautious when using the PS bidding rule to make inference about the behavior of buyers and sellers in a market where frictions are present such as eBay.

Keywords: Auctions; Internet; Frictions; Networks (search for similar items in EconPapers)
JEL-codes: C73 C78 D44 L00 (search for similar items in EconPapers)
Date: 2015-09-01
New Economics Papers: this item is included in nep-gth and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/67000/1/MPRA_paper_67000.pdf original version (application/pdf)

Related works:
Journal Article: Frictions in internet auctions with many traders: A counterexample (2016) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:67000

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().

 
Page updated 2025-03-24
Handle: RePEc:pra:mprapa:67000