Bid Takers or Market Makers? The Effect of Auctioneers on Auction Outcome

Auction design has been studied extensively; however, within a given design, does the process of how an auction is conducted matter as well? We address this question by looking for heterogeneity in the performance of auctioneers in English auctions. We analyze over 850,000 wholesale used car auction...

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Bibliographic Details
Published in:American economic journal. Microeconomics 2016-11, Vol.8 (4), p.195-229
Main Authors: Lacetera, Nicola, Larsen, Bradley J., Pope, Devin G., Sydnor, Justin R.
Format: Article
Language:English
Subjects:
Analysis
Auctions
Bids
Business metrics
Economic theory
Economics
Microeconomics
Prices
Sales
Standard deviation
Studies
Used automobiles
Wholesale
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Summary:Auction design has been studied extensively; however, within a given design, does the process of how an auction is conducted matter as well? We address this question by looking for heterogeneity in the performance of auctioneers in English auctions. We analyze over 850,000 wholesale used car auctions and find significant differences across auctioneers in outcomes for otherwise similar cars. The performance heterogeneities are stable across time and correlate with subjective evaluations by the auction house. We discuss the mechanisms driving differential performance and find evidence suggesting a role for tactics that generate bidder excitement or urgency.
ISSN:1945-7669
1945-7685
DOI:10.1257/mic.20150020