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Bidders' choice auctions: Raising revenues through the right to choose

Goeree, Jacob K. and Plott, Charles R. and Wooders, John (2003) Bidders' choice auctions: Raising revenues through the right to choose. Social Science Working Paper, 1181. California Institute of Technology , Pasadena, CA. (Unpublished) https://resolver.caltech.edu/CaltechAUTHORS:20171129-151426917

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Abstract

Keywords: Sales of multiple real-estate properties are often conducted via a sequence of ascending auctions, giving the winner at each stage the right to choose one of the available lots. We show that when bidders are risk averse, such “bidders' choice" auctions raise more revenues than standard simultaneous or sequential ascending auctions. We also report the results of laboratory experiments to investigate the effectiveness of bidders' choice auctions vis-à-vis the simultaneous ascending auction. The revenue-superiority of the bidders' choice auction is corroborated by the experimental data. Finally, we compare observed bidding behavior in the experiments with theoretically predicted bids to estimate a common risk aversion parameter from the data.


Item Type:Report or Paper (Working Paper)
Related URLs:
URLURL TypeDescription
http://resolver.caltech.edu/CaltechAUTHORS:20140303-103231406Related ItemPublished Article
ORCID:
AuthorORCID
Goeree, Jacob K.0000-0001-9876-3425
Additional Information:We are grateful to Roberto Burguet for very helpful suggestions, and to Larry Ausubel, Tim Cason, and participants at the European Economic Association Meetings in Stockholm (August, 2003) for comments. We acknowledge financial support from the Alfred P. Sloan Foundation, the National Science Foundation, and the Caltech Laboratory for Experimental Economics and Political Science. Published as Goeree, Jacob K. and Plott, Charles R. and Wooders, John (2004) Bidders' Choice Auctions: Raising Revenues Through the Right to Choose. Journal of the European Economic Association, 2 (2-3). pp. 504-515.
Group:Social Science Working Papers
Funders:
Funding AgencyGrant Number
Alfred P. Sloan FoundationUNSPECIFIED
NSFUNSPECIFIED
Caltech Laboratory for Experimental Economics and Political ScienceUNSPECIFIED
Series Name:Social Science Working Paper
Issue or Number:1181
Record Number:CaltechAUTHORS:20171129-151426917
Persistent URL:https://resolver.caltech.edu/CaltechAUTHORS:20171129-151426917
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:83574
Collection:CaltechAUTHORS
Deposited By: Jacquelyn Bussone
Deposited On:30 Nov 2017 00:02
Last Modified:03 Oct 2019 19:08

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