An experimental analysis of auctions with interdependent valuations

Oliver Kirchkamp and Benny Moldovanu ()

No 00-10, Sonderforschungsbereich 504 Publications from Sonderforschungsbereich 504, Universität Mannheim, Sonderforschungsbereich 504, University of Mannheim

Abstract: We study experiments in an auction setting with interdependent valuation. Groups of three players receive private signals and then bid for a single, indivisible item. Valuations for the item differ within groups and depend asymmetrically on a bidder's own and other bidders' signals. Theoretically, the English auction yields efficient allocations, while other standard auction formats fail to do so. Consistent with equilibrium predictions, we find that an English auction yields significantly more efficiency than a second price sealed bid auction. We also study the seller's expected revenue and the bidders expected payoff, and find that the experimental results are close to the theoretical predictions. (JEL C92, D44)

Pages: 40 pages
Date: 2000-02-11
New Economics Papers: this item is included in nep-exp and nep-gth
Note: Financial support from the Deutsche Forschungsgemeinschaft, SFB 504, at the University of Mannheim, is gratefully acknowledged.
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Citations: View citations in EconPapers (4)

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Related works:
Journal Article: An experimental analysis of auctions with interdependent valuations (2004)
Working Paper: An experimental analysis of auctions with interdependent valuations (2000)
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