Pay-to-bid auctions
By: Brennan C. Platt, Joseph Price, Henry Tappen.
Contributors: Price, Joseph.; Tappen, Henry.; National Bureau of Economic Research.
Series: NBER working paper series -- working paper 15695; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 15695.
Publisher: National Bureau of Economic Research
Published: 2010
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "We analyze a new auction format in which bidders pay a fee each time they increase the auction price.  Bidding fees are the primary source of revenue for the seller, but produce the same expected revenue as standard auctions.  Our model predicts a particular distribution of ending prices, which we test against observed auction data.  Our model fits the data well for over three-fourths of routinely auctioned items.  The notable exceptions are video game paraphernalia, which show more aggressive bidding and higher expected revenue.  By incorporating mild risk-loving preferences in the model, we explain nearly all of the auctions"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 3/9/2010.

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