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/lp/american-economic-association/ascending-prices-and-package-bidding-a-theoretical-and-experimental-LkYqkHO6VI
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- Publisher
- American Economic Association
- Copyright
- Copyright © 2010 by the American Economic Association
- Subject
- Articles
- ISSN
- 1945-7685
- eISSN
- 1945-7685
- DOI
- 10.1257/mic.2.3.160
- Publisher site
- See Article on Publisher Site
Abstract
Abstract We use theory and experiment to explore the performance of multi-round, price-guided, combinatorial auctions. We define efficiency-relevant and core-relevant packages and show that if bidders bid aggressively on these and losing bidders bid to their limits, then the auction leads to efficient or core allocations. We study the theoretically relevant behaviors and hypothesize that subjects will make only a few significant bids, and that certain simulations with auto-bidders will predict variations in performance across different environments. Testing the combinatorial clock auction (CCA) design, we find experimental support for these two hypotheses. We also compare the CCA to a simultaneous ascending auction. (JEL D44 )
Journal
American Economic Journal: Microeconomics – American Economic Association
Published: Aug 1, 2010