blog #1 - Factors Changing the Auction World: Bid Timing...

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Factors Changing the Auction World: Bid Timing and Software Agents March 24, 2008 The second price (sealed bid) auction runs the same as the first price auction, except the winner pays the second highest bid. Today, eBay is one of the most popular second price auctions (along with Google, Amazon.com, AuctionWatch.com and Yahoo!, etc) in the markets. According to eBay’s second price auction, each buyer specifies their maximum bid. And then the current bid price is set to the second highest bid, plus a minimum bid increment. But how does the timing of bids favor or disfavor buyers in an ordinary eBay auction? According to the article attached by link, different types of software agents and how well they perform depend greatly on the rules of the game. Since eBay has a fixed deadline, certain incentives may persuade bidders to bid late. In these cases, artificial last-minute bidding agents (i.e. esnipe.com) help bidders by allowing them to out-compete other bidders based on their submitted bids. But this all depends on the behaviors from different bidders (strategy comes into
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This note was uploaded on 04/06/2009 for the course ECON 2040 taught by Professor Easley/kleinberg during the Spring '07 term at Cornell University (Engineering School).

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