Strategic Implications of Uncertainty Over One's Own Private Value in Auctions

31 Pages Posted: 19 May 2001

See all articles by Eric Bennett Rasmusen

Eric Bennett Rasmusen

Indiana University - Kelley School of Business - Department of Business Economics & Public Policy

Date Written: January 26, 2003

Abstract

Bidders have to decide whether and when to incur the cost of estimating their own values in auctions. This can explain sniping - flurries of bids late in auctions with deadlines - as the result of bidders trying to avoid stimulating other bidders into examining their bid ceiling more carefully.

Keywords: auctions, private values, sniping, bid ceilings, E-Bay

JEL Classification: D44

Suggested Citation

Rasmusen, Eric Bennett, Strategic Implications of Uncertainty Over One's Own Private Value in Auctions (January 26, 2003). Available at SSRN: https://ssrn.com/abstract=267932 or http://dx.doi.org/10.2139/ssrn.267932

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