| Authors |
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| Publication date |
2011
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| Series |
Tinbergen Institute Discussion Paper, TI 2011-024/1
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| Number of pages |
26
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| Publisher |
Amsterdam / Rotterdam: Tinbergen Institute
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| Organisations |
-
Faculty of Economics and Business (FEB) - Amsterdam School of Economics Research Institute (ASE-RI)
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| Abstract |
If a government auctions the right to market a good, continuity is likely to be of significant importance. In a laboratory experiment, we compare the effects of bidders' limited liability in the first-price sealed-bid auction and the English auction in a common value setting. Our data strongly reject our theoretical prediction that the English auction leads to less aggressive bids and fewer bankruptcies than the first-price sealed-bid auction. X-cursedness gives a robust explanation of our experimental observations, in contrast to risk aversion and asymmetric equilibria.
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| Document type |
Working paper
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| Language |
English
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| Published at |
http://www.tinbergen.nl/discussionpapers/11024.pdf
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