Frictions in internet auctions with many traders: A counterexample

Javier Donna, Pablo Schenone, Gregory Veramendi

Research output: Contribution to journalArticle

Abstract

We show that when frictions are present, the Peters and Severinov (2006) (PS) bidding rule is no longer efficient nor a PBE of the PS game. Researchers should be cautious when using the PS bidding rule in markets with frictions like eBay.

Original languageEnglish (US)
Pages (from-to)81-84
Number of pages4
JournalEconomics Letters
Volume138
DOIs
StatePublished - Jan 1 2016

Keywords

  • Auctions
  • Frictions
  • Internet
  • Networks

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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