"Learning to set the reserve price optimally in laboratory first price " by Priyodorshi Banerjee, Shashwat Khare et al.
 

Learning to set the reserve price optimally in laboratory first price auctions

Article Type

Research Article

Publication Title

Games

Abstract

We analyze choices of sellers, each setting a reserve price in a laboratory first price auction with automated equilibrium bidding. Subjects are allowed to gain experience for a fixed period of time prior to making a single payoff-relevant choice. Behavior of more experienced sellers was consistent with benchmark theory: average reserve price for these sellers was independent of the number of bidders and equaled the predicted level. Less experienced sellers however deviated from the theoretical benchmark: on average, they tended to shade reserve price below the predicted level and positively relate it to the number of bidders.

DOI

10.3390/g9040079

Publication Date

12-1-2018

Comments

All Open Access, Gold, Green

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