Abstract
This paper examines the impact of sellers' choice of auction parameters on the level of their revenues using data from Yahoo.com's Playstation 2 system auctions. Our study specifically highlights the impact of the ending rule. We introduce a new variable called Winning Bid Ratio (WBR), and use it as a proxy for seller revenues. WBR is the ratio of the winning bid of an auction to the buy price offered by the seller. We find that choosing a high bid increment and including a shipping price decreases the WBR. Alternatively, lower number of bids and choosing a shorter auction length have a positive effect on the WBR. On the whole, the ending rule has a negative effect on the WBR, which is in accord with the theoretical predictions in the literature. However, we also find variations in the results for the effect of ending rule when we divide the data into two groups consisting of high and low-value auctions.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
