EconPort - Online Resources

Lists several auction types and briefly discusses the effect known as the winner's curse. [Details...]

2. Going, Going, Gone! A Survey of Auction Types

One of the best ways to allocate goods and/or resources is to sell them using free market techniques and ideas. An auction is an excellent method of distributing goods to those who value them most highly. Auctions, however, are far more complex than most people realize. Kate Reynolds has developed a series of articles for Agorics, explaining different auction types and some of the issues important in determining whether to use auctions and, if so, which kind. What exactly is an auction? You may think you already know. Then again . . . [Details...]

3. The Bidding Game

This article discusses the development of auction theory and the modern use of auctions. [Details...]

4. Auction with Mix of Common and Private Values

This program implements an auction in which each bidder's value for a prize is the sum of an individual-specific component (the private value) and a common component (the common value). [Details...]

5. Buyer's Curse Acquisition Auction

This program runs a set of two-person "takeover games" in which one makes a bid to acquire an object that is owned by the other. [Details...]

6. Call Market

This program runs a call market in which buyers and sellers submit bids and offers. These bids and offers are arrayed into "pseudo" demand and supply curves, which are "crossed" to determine a provisional trading price. The market is called and all provisional trades are finalized when the experimenter submits a close decision. At that time, all units with offers below the clearing price are sold, and all units with bids above the clearing price are purchased. The program calculates the theoretical competitive price for comparison. [Details...]

7. Common Value Auction

This program implements a first price common value auction in which each bidder receives a random draw from a uniform distribution. The value of the prize is the average of these draws, so each bidder only sees a part of the common value. [Details...]

8. Double Auction Market

This program runs a double auction in which buyers and sellers submit bids and offers in any order. [Details...]

9. ESL One-Sided Auctions

This software provides several types of one-sided auctions, including: 1. English; 2. Dutch; 3. First-price sealed bid; and 4. Second-price sealed bid. The software allows any combination of these auction types within a single experiment. Further, each auction type can be customized by the use of many parameter settings. [Details...]

10. Private Value Auction

This program implements a private-value auction. In each period, all bidders receive random private values that are independent draws from a uniform distribution (which permits a common deterministic value as a special case). [Details...]

11. Seller Reserve Price Auction

This program implements two-sided private-value auctions in which one person in each group is a seller who sets a (public or secret) reserve price. The remaining people are bidders. [Details...]

12. Water Auction

This program sets up an auction in which the bidders are "farmers" with multiple irrigation permits that can either be used (to earn money farming) or sold to the "state" at auction. The state has set aside funds to buy irrigation permits with the goal of reducing irrigation during a designated "draught" year. The state is interested in obtaining the maximum irrigation reduction for a given expenditure, so the lowest bids to sell permits are accepted. There may also be a maximum accepted bid, based on political or strategic considerations. Since permits pertain to various sized plots of land, all bids are submitted on a per-acre basis. As the experimenter, you represent the state. You can specify a target number of acres to be taken out of irrigation, a maximum amount of money to be spent, and a maximum bid. The program determines the permits which will be purchased, subject to the constraints of not acquiring more than the target number of acres, not accepting bids above the maximum, and not spending more than the budget. Bidding takes place in a series of "rounds." In each round, the state announces which permits would have been purchased had that been the final round (given the target acres, maximum bid, and budget constraints). Bidders do not know in advance which will be the final round. As the experimenter, you set the maximum number of rounds, but the auction may stop earlier if the acreage target can be met within budget (to disable this feature, set a high target). [Details...]

13. Auctions: Theory and Practice

This book is a non-technical introduction to auction theory; its practical application in auction design (including many examples); and its uses in other parts of economics. It can be used for a graduate course on auction theory, or by picking selectively an advanced undergraduate or MBA course on auctions and auction design. [Details...]