Introduction

Abstract

This paper is a survey of applied work with auction data. First, we summarize the pre-game theoretic competitive bidding literature based on decision theory and the associated empirical work, centered essentially around the winner's curse debate. Then, we review the main distribution free predictions of the three major game theoretic models, the identification of their stochastic structure, and their confrontation with data. We study successively, the symmetric common value model, the independent private values model and the asymmetric common value model. Conditional upon being in one of these models, game theoretic restrictions can be tested.A major conclusion is that predictions are highly dependent on the unobservable restrictions on the distributions of characteristics. The paper concludes with a suggestion to develop a structural econometrics of auction data with only a few restrictions on these distributions.