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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/28307
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| Title: | Energizing Bidder's Choice in Financial Assets Auctions - An
Experimental Investigation |
| Authors: | Brenner, Menachem
Galai, Dan
Sade, Orly |
| Issue Date: | 6-Oct-2009 |
| Series/Report no.: | FIN-09-015 |
| Abstract: | The objective of this paper is to investigate the preferences of
potential bidders in choosing between uniform and discriminatory auction
pricing methods. Many financial assets, particularly government bonds,
are issued in an auction. Uniform and discriminatory pricing constitute
the two most popular mechanisms used in public auctions. Theoretical
papers have not been able to provide an unequivocal preference of one
mechanism over the other. This study investigates both bidder choice and
the impact of that choice on the outcome of the auction by allowing
bidders to choose between the two alternative systems. The majority of
the bidders in the survey prefer uniform pricing. Those preferring
uniform auctions tend to bid more aggressively than those preferring
discriminatory. On average, the proceeds to the issuer were higher under
the uniform price mechanism. |
| URI: | http://hdl.handle.net/2451/28307 |
| Appears in Collections: | Finance Working Papers
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