Article ID: | iaor2007578 |
Country: | United States |
Volume: | 43 |
Issue: | 3 |
Start Page Number: | 462 |
End Page Number: | 476 |
Publication Date: | Aug 2006 |
Journal: | Journal of Marketing Research |
Authors: | Zeithammer Robert |
Keywords: | bidding, game theory |
At Internet auction sites, such as eBay, nearly identical goods are often sold in a sequence of auctions, separated by small amounts of time. Upcoming auctions are announced several days in advance, so buyers can benefit from forward-looking strategies that take this information into account. This article develops a model of such bidding, provides empirical evidence of the model's relevance to actual behavior on eBay, and discusses the general implications of forward-looking bidding for sequential, auction-driven marketplaces.