Common Value Auctions and the Winner's Curse

Description

An invaluable account of how auctions work-and how to make them work Few forms of market exchange intrigue economists as do auctions, whose theoretical and practical implications are enormous. John Kagel and Dan Levin, complementing their own distinguished research with papers written with other specialists, provide a new focus on common value a

John H. Kagel is University Chaired Professor of Applied Economics and director of the Economics Laboratory at Ohio State University. A leading economic theorist, he is coeditor of, and a contributor to, The Handbook of Experimental Economics (Princeton). Dan Levin is professor of economics at Ohio State University. He has published numerous articles on competitive bidding and industrial organization in leading economic journals.

"I know of no book that offers such a comprehensive treatment of theory and experiments in common value auctions. The papers it brings together represent very significant contributions to both auction theory and auction behavior and are of the highest quality."--Douglas Davis, Virginia Commonwealth University "This book shows that the kind of winner's curse at issue is pervasive across various types of auctions and is not eliminated by experience or even by using expert bidders. One of its main contributions is the specification of naive bidding models that explain patterns of deviations from (Nash) theoretical predictions. The ex post perspectives about how to improve experimental designs and procedures for dealing with bankruptcies were particularly interesting."--Charles A. Holt, University of Virginia