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Cartel stability in experimental first-price sealed-bid and English auctions

Jeroen Hinloopen (), Sander Onderstal () and Leonard Treuren ()
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Leonard Treuren: University of Amsterdam

No 19-009/VII, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: Using laboratory experiments, we compare the stability of bidding rings in the English auction and the first-price sealed-bid auction in a heterogeneous-value setting. In both a re-matching condition and a fixed-matching condition, we observe that biddings rings are more stable in the English auction than in the first-price sealed-bid auction. In both conditions, the first-price sealed-bid auction dominates the English auction in terms of average revenue and the revenue spread. The English auction outperforms the first-price sealed-bid auction in terms of efficiency.

Keywords: Cartel stability; English auction; First-price sealed-bid auction; Laboratory experiments (search for similar items in EconPapers)
JEL-codes: C92 D44 L41 (search for similar items in EconPapers)
Date: 2019-01-27, Revised 2020-06-31
New Economics Papers: this item is included in nep-com, nep-des, nep-exp and nep-ind
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