Reverse Procurement and Auctions for Consumers: A New Trend on the Horizon of E-Commerce?

WIRTSCHAFTSINFORMATIK, Vol. 48, 2006

10 Pages Posted: 20 Feb 2009

See all articles by Michael Klafft

Michael Klafft

Humboldt University of Berlin

Sarah Spiekermann

Vienna University of Economics and Business

Date Written: February, 20 2009

Abstract

Internet auctions have become very important for B-2-C E-Commerce. With 56 million active users, eBay alone generates a 34 billion in turnover per annum [Ebay05, 2]. Typically, forward auctions with an ascending- bid mechanism are employed in B-2-C or C-2-C environments. Sellers initiate auctions and buyers compete for the products offered which causes prices to rise until the highest bid wins. With a similar auction design, eBay (holding over 80% market share of all online retail auctions) is "seller-oriented": It is the seller who initiates the process, and it is equally the seller who is then favoured by inexperienced buyers who often overbid and overpay their target items; a phenomenon called "the winner's curse".

Keywords: Reverse Auctions, Consumer Surplus, Bid Invitations, Procurement

JEL Classification: O31, O33

Suggested Citation

Klafft, Michael and Spiekermann, Sarah, Reverse Procurement and Auctions for Consumers: A New Trend on the Horizon of E-Commerce? (February, 20 2009). WIRTSCHAFTSINFORMATIK, Vol. 48, 2006, Available at SSRN: https://ssrn.com/abstract=1346874

Michael Klafft

Humboldt University of Berlin ( email )

Spandauer Strasse 1
Berlin, 10178
Germany

Sarah Spiekermann (Contact Author)

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, Wien 1020
Austria

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