Ernst, Christiane and Thöni, Christian (2013) Bimodal bidding in experimental all-pay auctions. Games, 4 (4). pp. 608-623. ISSN 2073-4336
Full text not available from this repository.Abstract
We report results from experimental first-price, sealed-bid, all-pay auctions for a good with a common and known value. We observe bidding strategies in groups of two and three bidders and under two extreme information conditions. As predicted by the Nash equilibrium, subjects use mixed strategies. In contrast to the prediction under standard assumptions, bids are drawn from a bimodal distribution: very high and very low bids are much more frequent than intermediate bids. Standard risk preferences cannot account for our results. Bidding behavior is, however, consistent with the predictions of a model with reference dependent preferences as proposed by the prospect theory.
| Item Type: | Article |
|---|---|
| Official URL: | http://www.mdpi.com/journal/games |
| Additional Information: | © 2013 MDPI AG |
| Divisions: | LSE |
| Subjects: | H Social Sciences > HB Economic Theory Q Science > QA Mathematics |
| Date Deposited: | 21 Feb 2014 17:14 |
| Last Modified: | 12 Dec 2024 00:29 |
| URI: | http://eprints.lse.ac.uk/id/eprint/55816 |
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