Arbeitspapier
Reserve prices in auctions as reference points
We consider second-price and first-price auctions in the symmetric independent private values framework. We modify the standard model by the assumption that the bidders have reference-based utility, where a publicly announced reserve price has some influence on the reference point. It turns out that the seller’s optimal reserve price is increasing in the number of bidders. Also in contrast to the standard model, we find that secret reserve prices can outperform public reserve prices, and that setting the optimal reserve price can be more valuable for the seller than attracting additional bidders.
- Sprache
-
Englisch
- Erschienen in
-
Series: Bonn Econ Discussion Papers ; No. 24/2005
- Klassifikation
-
Wirtschaft
Auctions
Asymmetric and Private Information; Mechanism Design
Criteria for Decision-Making under Risk and Uncertainty
- Thema
-
Auction theory
reference-dependent utility
reserve prices
Auktionstheorie
Wirtschaftspsychologie
Verhaltensökonomik
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Rosenkranz, Stephanie
Schmitz, Patrick W.
- Ereignis
-
Veröffentlichung
- (wer)
-
University of Bonn, Bonn Graduate School of Economics (BGSE)
- (wo)
-
Bonn
- (wann)
-
2005
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:44 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Rosenkranz, Stephanie
- Schmitz, Patrick W.
- University of Bonn, Bonn Graduate School of Economics (BGSE)
Entstanden
- 2005
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