Chapter 10 Strategy Proof Equilibrium Behavior in Two Sided Auctions The experimental evidence from three prominent auction trading institutions: (1) the continuous double auction (2) the uniform price sealed bid offer auction and (3) the uniform price double auction (with continuous feedback of real time information on the acceptance status of bids and offers) shows that subjects are able to work out a behavioral equilibrium which is strategy proof. In institutions (2) and (3) this is achieved by a groping process which (a) approximates the competitive equilibrium and (b) produces a large number of bids and offers that are tied or nearly tied. Impossibility theorems provide important insight as to why the above two sided mechanisms have difficulty achieving perfection but they do not address the question as to why such field mechanisms when studied in the laboratory perform so well in fact surprisingly well given the theorems and the fact that we observe massive underrevelation in the experiments.