TY  - JOUR
TI  - Allotment in First-Price Auctions: An Experimental Investigation
AB  - We experimentally study the effects of allotment—the division of an item into homogeneous units—in independent private value auctions. We compare a bundling first-price auction with two equivalent treatments where allotment is implemented: a two-unit discriminatory auction and two simultaneous single-unit first-price auctions. We find that allotment in the form of a discriminatory auction generates a loss of efficiency with respect to bundling. In the allotment treatments, we observe large and persistent bid spread, and the discriminatory auction is less efficient than simultaneous auctions. We provide a unified interpretation of our results that is based on both a non-equilibrium response to the coordination problem characterizing the simultaneous auction format and a general class of behavioral preferences that includes risk aversion, joy of winning and loser’s regret as specific cases.
DO  - http://dx.doi.org/10.1007/s10683-016-9476-1
SP  - 70
EP  - 99
UR  - https://link.springer.com/article/10.1007%2Fs10683-016-9476-1
PY  - 2017-01-01
JO  - Experimental Economics
AU  - Corazzini, Luca  
AU  - Galavotti, Stefano 
AU  - Sausgruber, Rupert 
AU  - Valbonesi, Paola 
ER -