1 Auction Formats and Pricing Rules Auctions (The MIT Press Essential Knowledge series) by Timothy P. Hubbard, Harry J. Paarsch - ingleseolandesebustachiusaprimoprezzoosecondoprezzo oggettipreziosi radunareunpubblicodisperso astesvelteperifiori ilprezzodelpesce teoriaepraticaineconomia nessunosioffende asimmetrierisolte
After the reigning emperor had been overthrown in AD 193, the entire Roman Empire was sold at auction.Read more at location 125
When computer programmer Pierre Omidyar sold a broken laser pointer for more than $14 using his online company AuctionWeb, he surely had no idea his website, now eBay, would become a Fortune 500 company.Read more at location 126
Suppliers of milk to public schools in several US states were found guilty of bid-rigging,Read more at location 131
With use dating back to at least 500 BC, the auction is among the oldest market institutions.Read more at location 136
music has been traditionally sold as a good intended to be enjoyed by the consumer who purchased the album.Read more at location 138
many listeners of a band’s album likely have not purchased the music. Perhaps this is why the American hip-hop group Wu-Tang Clan announced in the summer of 2014 plans to sell at auction the only copy of their album Once Upon A Time In Shaolin.Read more at location 140
an auction is a way of allocating an object or acquiring a service.Read more at location 147
Famous authors have used auctions to sell the right to publish books from manuscripts;Read more at location 157
at some universities, opportunities for students to enroll in courses are allocated using auctions.Read more at location 158
Filene’s Basement was a discount retailer in Boston that automatically marked down all items by increasingly higher percentages over a thirty-day period before giving unsold items to charity.Read more at location 161
Despite their durability and flexibility, auctions appear underappreciated, not just by the typical person, but also by many economists.Read more at location 167
In fact the word “auction” is scarcely even heard within the walls of economics classrooms around the world.Read more at location 169
when policy makers around the world decided to sell off the rights to use the electromagnetic spectrum for such devices as cell phones, they turned to auction researchers to design marketsRead more at location 173
auctions—William S. Vickrey specifically, but Eric S. Maskin and Roger B. Myerson for their work in mechanism design, and Vernon L. Smith and Alvin E. Roth for their work concerning alternative market mechanisms too.Read more at location 177
The two auction formats are the open (sometimes referred to as the oral or the open outcry format) and the sealed-bid, perhaps best thought of as the closedRead more at location 191
Under the first, the winner must pay what was bid; this is referred to as the first-price rule, at least by economists.Read more at location 192
Under the second, the winner must pay what the highest opponent bid (the second-highest bid), so this is referred to as the second-priceRead more at location 193
Perhaps the best-known type of auction is the oral, ascending-price auction, which is sometimes referred to as the English auction.Read more at location 196
Latin word auctus—the past participle of the verb augere, which means to augment or to raise.Read more at location 197
The English auction is used by the world’s two largest auction houses Christie’s and Sotheby’s to sell high-quality antiques, art, jewelry, and wine among other things.Read more at location 205
In contrast to the oral, ascending price of the English auction is the oral, descending-price auction, often referred to as the Dutch auction, perhaps because this type of auction is used to sell flowers in the town of Aalsmeer in the Netherlands.Read more at location 210
calls out successively lower prices, but often a clock is used to automate the task. Specifically, the clock is set at a very high priceRead more at location 212
The first buyer to stop the clock, either by shouting “Stop!” or by using some other device, wins the auction and must pay the current price on the clock.Read more at location 213
note that at English auctions many bids can be (and are often) made, so the bidding process can take some time, whereas at Dutch auctions only one bid is observed—thatRead more at location 218
This distinction is important for the Dutch flower auctions at which more than twenty million flowers are sold on a typical day.Read more at location 219
when Google went public in the summer of 2004, it was reported to have sold its shares using the Dutch auction.Read more at location 222
Dutch and English auctions are dynamic in the sense that price changes are visible to bidders as the auction progresses, hence the term “open.”Read more at location 227
Today, however, many auctions are held electronically, with bidders accessing a computer server on which the auction is conducted virtually. For example, the Portland Fish Exchange (PFEX) in Maine, the oldest all-display, fresh seafood auction in the United States, is an electronic auction.Read more at location 229
the PFEX is actually a hybrid Dutch–English auction: the price starts at a set opening price determined by the auctioneer and initially drops; when one bidder expresses interest in a certain type (size and species) of fish, the price then rises in one-cent increments until no one is willing to increase the price further.Read more at location 239
At sealed-bid auctions, buyers indicate how much they are willing to pay for the object on sale by submitting a bid in secret to the auctioneer, traditionally in a sealed envelope,Read more at location 242
In contrast, at a second-price, sealed-bid auction, the winning bidder pays the second-highest bid tendered. This small difference in the pricing rules generates important differences in behaviorRead more at location 249
first-price, sealed-bid auctions are employed extensively and play central roles in the decisions made by policy makers in most countries.Read more at location 253
In short, if a government agency seeks to purchase a good or service, then it often must solicit bids from several suppliers,Read more at location 257
the public procurement process is exactly like a first-price, sealed-bid auction, except that the winning bidder is paid to provide a good or serviceRead more at location 260
these procurement auctions are often referred to as low-price, sealed-bid auctions or reverse auctions.Read more at location 261
White House reports that more than one of every six dollars spent by the federal government is paid to such contractors.Read more at location 265
The second-price, sealed-bid auction is commonly referred to as the VickreyRead more at location 267
stamp collectors had used second-price, sealed-bid auctions during the late nineteenth century,Read more at location 269
Consider a philatelist living in a remote location during the 1800s and seeking to sell some stamps. An English auction held locally would likely not have attracted a large groupRead more at location 269
In contrast, if stamp sales could be publicized and bids submitted through the mail,Read more at location 272
when awarding a procurement contract using an auction, some government agencies choose the bidder whose tender is closest to the average bid. In Italy, between 2000 and 2006, procurement contracts were awarded using an average-bid pricing rule whenever five or more bidders submitted tenders.Read more at location 278
opportunity cost represents the value of a resource in its next-best alternative.Read more at location 323
First, a reasonable price was discovered and the allocation problem solved. Second, the ticket was awarded to the friend who was willing to pay the most to see the game; such an allocation is referred to as efficient because the object went to the bidder who valued the ticket the most. Third, the price discovered through the auction represents the opportunity cost of the ticket, the value of the ticket in its next-best use. Fourth, the auction generated attractive outcomes for both the buyer and the seller—inRead more at location 327
Missing from the example above is the element of time. Not only do auctions have the attractive allocational properties discussed but the rules can be structured so that such allocations are achieved in a timely manner.Read more at location 333
It’s likely that you and your friends or siblings left abandoned games of Monopoly for hours,Read more at location 335
Frequently the games were likely drawn out because you just could not land on the property needed to complete ownership of a color group. The original Parker Brothers rules actually dictate that the all-responsible Banker also serve as an Auctioneer. If you land on a property that no one owns, then you have the right to buy the property at the printed price. Often overlooked, however, is the sentence that soon follows: “If you do not wish to buy the property, the Banker sells it at auction to the highest bidder.” It seems the Parker Brothers understood that auctions are a way of allocating goods quickly.Read more at location 336
Central to the study of auctions, and implicit in the baseball ticket story above, is the notion of asymmetric information: the seller of an object does not know any bidder’s valuation for that object.Read more at location 343
transparent way of allocating the ticket. None of your friends will be offended because each agreed to respect the rules and outcome of the auction.Read more at location 352
With the collapse of the Soviet Union, how did the former republics transition from planned economies to market-based economies? In part, by privatizing state-owned assets, which were often sold at auction.Read more at location 366
Auctions are ideal for selling objects that have no standard value. Sometimes, the object at auction may be unique, as in the case of formerly state-owned enterprises;Read more at location 367
prices are likely to vary depending on daily circumstances. For example, the world’s largest fish market in the Tsukiji district of Tokyo uses the auction.Read more at location 369
fish move constantly in the ocean; weather patterns are unpredictable too.Read more at location 371
even today many Roman Catholics still eat fish on Fridays. In addition the quality of the fish can vary depending on how the fish are caught,Read more at location 372
Auctions are one area of economics where theoretical and empirical work is most closely linked,Read more at location 384
Note: TEORIA E PRASSI
