Late and Multiple Bidding in Competing Second Price Internet Auctions
Date
01.01.2004
01.01.2004
Authors
Marta Stryszowska
JEL Code
D44
D44
Keywords:
Auctions,Electronic Commerce,Internet
Auctions,Electronic Commerce,Internet
Publisher
Economy and Society
Economy and Society
Editor
Fausto Panunzi
Fausto Panunzi
Internet auctions, such as those on eBay, are known for multiple bidding and sniping. Buyers send bids in the closing seconds of an auction, knowing that bids arriving after the closure of the auction are not counted. They also bid several times at the same auction. We model Internet auction as a dynamic multi-unit auction. This let us explain the rationality of both sniping and multiple bidding. By submitting multiple bids, buyers co-ordinate between auctions, so that all objects are finally sold and no-one has to pay too high a price. When bidders submit multiple bids, they might bid very late in the end.