Comparative analysis of multi-item online auctions: Evidence from the laboratory

Ravi Bapna, Paulo Goes, Alok Gupta

Research output: Contribution to journalArticle

27 Scopus citations

Abstract

The dynamics of customer relationship are being reshaped by price-setting processes such as online auctions. This paper analyzes price setting process in business-to-consumer (B2C) online auctions. Typically, these auctions involve multiple identical units and utilize a variant of the traditional English-auction mechanism. We describe an online laboratory experiment that compares the efficiency of such a mechanism with a multi-item version of Vickrey's [Journal of Finance 41 (1961) 8.] second-price auction with respect to both seller's revenue and allocative efficiency. Our results reject the revenue equivalence principle and indicate that English auctions may dominate the Vickrey auctions. However, we observe that the allocative efficiency of Vickrey auctions is higher than the English auctions.

Original languageEnglish (US)
Pages (from-to)135-153
Number of pages19
JournalDecision Support Systems
Volume32
Issue number2
DOIs
StatePublished - Dec 1 2001

Keywords

  • CRM
  • Electronic commerce
  • Laboratory experimentation
  • Online auctions

Fingerprint Dive into the research topics of 'Comparative analysis of multi-item online auctions: Evidence from the laboratory'. Together they form a unique fingerprint.

  • Cite this