An experimental investigation of entry cost effects in sealed bid dollar auctions

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An experimental investigation of entry cost effects in sealed bid dollar auctions

Please use this identifier to cite or link to this item: http://hdl.handle.net/10036/114748

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Title: An experimental investigation of entry cost effects in sealed bid dollar auctions
Author: Chakravarty, Surajeet
Ghosh, Sudeep
Citation: Volume 111, Issue 2, May 2011, Pages 122–124
Publisher: Elsevier
Journal: Economics Letters
Date Issued: 2010
URI: http://hdl.handle.net/10036/114748
DOI: 10.1016/j.econlet.2011.01.011
Links: http://business-school.exeter.ac.uk/research/areas/topics/economics/outputs/
Abstract: In numerous auction settings potential bidders incur costs to enter the auction. Such costs may potentially influence bidder’s behavior subsequently. In this paper we experimentally study the effect of entry costs on bidding and entry behavior, through a complete information common value auction. We run first and second price auctions both with and without entry costs. We find that with entry costs, players on average bid lower in first price auctions, while in second price auctions the average bids are higher, compared to bids in the corresponding no entry fee auctions.
Type: Working Paper
Description: Discussion paper
Keywords: Common value auctionsEntry costsexperiments
ISSN: 1473 – 3307


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