Replication data for: The Bidder's Curse
Principal Investigator(s): View help for Principal Investigator(s) Ulrike Malmendier; Young Han Lee
Version: View help for Version V1
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Project Citation:
Malmendier, Ulrike, and Lee, Young Han. Replication data for: The Bidder’s Curse. Nashville, TN: American Economic Association [publisher], 2011. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-11. https://doi.org/10.3886/E112411V1
Project Description
Summary:
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We employ a novel approach to identify overbidding in auctions. We compare online auction prices to fixed prices for the same item on the same webpage. In detailed data on auctions of a board game, 42 percent of auctions exceed the simultaneous fixed price. The result
replicates in a broad cross-section of auctions (48 percent overbidding). A small fraction of overbidders, 17 percent of bidders, suffices to generate the large fraction of auctions with overbidding. We show that the observed behavior is inconsistent with rational behavior, even allowing for uncertainty about prices and switching costs, since the expected auction price also exceeds the fixed price. Limited
attention best explains our results. (JEL D12, D44)
Scope of Project
JEL Classification:
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D12 Consumer Economics: Empirical Analysis
D44 Auctions
D12 Consumer Economics: Empirical Analysis
D44 Auctions
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