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Recurring auctions are ubiquitous for selling durable assets such as artwork and homes, with
follow-up auctions held for unsold items. We investigate such auctions theoretically and empirically.
Theoretical analysis demonstrates that recurring auctions outperform single-round
auctions when buyers face entry costs, enhancing efficiency and revenue due to sorted entry
of potential buyers. Optimal reserve price sequences are characterized. Empirical findings
from home foreclosure auctions in China reveal significant annual gains in efficiency (3.40
billion USD, 16.60%) and revenue (2.97 billion USD, 15.92%) using recurring auctions compared
with single-round auctions. Implementing optimal reserve prices can further improve
efficiency (3.35%) and revenue (3.06%).
