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Permanent URL to this publication: http://dx.doi.org/10.5167/uzh-59281

Goeree, Jacob K; Offerman, Theo (2002). Efficiency in Auctions with Private and Common Values: An Experimental Study. American Economic Review, 92(3):625-643.

Published Version


Auctions are generally not efficient when the object’s expected value depends on
private and common value information. We report a series of first-price auction
experiments to measure the degree of inefficiency that occurs with financially
motivated bidders. While some subjects fall prey to the winner’s curse, they
weigh their private and common value information in roughly the same manner
as rational bidders, with observed efficiencies close to predicted levels. Increased
competition and reduced uncertainty about the common value positively
affect revenues and efficiency. The public release of information about the
common value also raises efficiency, although less than predicted.

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Economics
DDC:330 Economics
Deposited On:29 Feb 2012 10:04
Last Modified:20 Dec 2013 23:04
Publisher:American Economic Association
Free access at:Related URL. An embargo period may apply.
Publisher DOI:10.1257/00028280260136435
Related URLs:http://www.jstor.org/stable/3083358 .
Other Identification Number:merlin-id:4986
Citations:Web of Science®. Times Cited: 27
Google Scholar™
Scopus®. Citation Count: 31

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