Bidding up, buying out and cooling-off: an examination of auctions with withdrawal rights

B-Tier
Journal: Economic Theory
Year: 2000
Volume: 16
Issue: 3
Pages: 585-611

Score contribution per author:

2.011 = (α=2.01 / 1 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

This paper considers a model in which bidders in an auction are faced with uncertainty as to their final valuation of the auctioned object. This uncertainty is resolved after the auction has taken place. It is argued that the inclusion of a cooling-off right raises the expected revenue to the seller when bidders face a risk of the object being a strict `bad', in that owning the object incurs negative utility to the winner of the auction. The model is then tested in a laboratory setting. The evidence from this experiment supports the predictions of the theory.

Technical Details

RePEc Handle
repec:spr:joecth:v:16:y:2000:i:3:p:585-611
Journal Field
Theory
Author Count
1
Added to Database
2026-01-24