Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/23398
Authors: 
Raviv, Yaron
Year of Publication: 
2004
Series/Report no.: 
Working paper series / Claremont McKenna College 04,11
Abstract: 
I study the sequence of bidding in an open-outcry English auction to examine how the strategic bidding process affects price determination. I do this by studying the anomalous nature of ?jump bidding? in data I have collected from a series of public auctions of used cars in New Jersey. Jump bidding occur when a new offer is submitted that is above the old offer plus the minimum bid increment permitted. I find that jump biddings are an empirical regularity in all items sold. The jumps are a function of the presale estimate of the item?s price but are not affected by the selling order. I suggest a way to use the Jump Biddings to determine whether an open-outcry auction is best interpreted with models that assume private-or common-item valuations, and conclude that these auctions are consistent with the common values interpretation.
Subjects: 
Auction
JEL: 
D44
Document Type: 
Working Paper

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