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Document Type

Article

Abstract

Internet auctions can be ended in different ways. EBay auctions, for example, end at a predetermined time while Amazon auctions do not. The auctions at Amazon are extended by ten minutes if a bid is submitted within the last ten minutes of an auction. EBay’s hard closing rule induces bidding strategies that can produce inefficient results. Nevertheless, a hard close ending rule is more efficient than the automatic extension rule used by Amazon. EBay’s hard closing rule can be modified to resemble a Vickrey second-price auction. The modifications would make auctions on eBay more efficient.

Publication Date

Spring 2004

Journal Title

Major Themes in Economics

Volume

6

Issue

1

First Page

37

Last Page

48

Copyright

©2004 by Major Themes in Economics

Language

EN

File Format

application/pdf

Included in

Economics Commons

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