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
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: Suggested Citation
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