Social and Information Sciences Laboratory (SISL) Seminar

Friday October 25, 2019 12:00 PM

Common-Value versus Common-Probability Auctions

Speaker: Kathleen Ngangoue, Department of Economics and Center for Experimental Social Science, New York University
Location: Baxter 125

Abstract: We compare two equivalent variants of an experimental common value auction: In one more-standard auction format, uncertainty about the common-value item is defined over outcomes, while in another format–a so-called common-probability auction–uncertainty is defined over probabilities. In contrast to the substantial overbidding found in common-value auctions, bidding behavior in common-probability auctions is consistent with risk-neutral Nash equilibrium bids and even exhibits slight underbidding. (Joint work with Andy Schotter)

Series Linde Institute/Social and Information Sciences Laboratory Seminar Series (SISL)

Contact: Mary Martin at 626-395-4571 mmartin@caltech.edu