Vickrey auctions: Lovely but lonely
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Vickrey auctions: Lovely but lonely
This 2002 Stanford journal article examines Vickrey (second-price) auction and asks why these auctions, though they may seem more elegant than first-price auctions, have failed to gain widespread popularity aside from a few exceptions. It still faces problems with buyers who are reluctant to reveal the values they want to pay, and its major problem is that it poses a complex problem to bidders.
But I think that despite these flaws, it seems Vickrey auctions are gaining in popularity (who doesn't know how to use eBay?). Will they eventually outpace their first-price counterparts?
But I think that despite these flaws, it seems Vickrey auctions are gaining in popularity (who doesn't know how to use eBay?). Will they eventually outpace their first-price counterparts?
adamp- Posts : 28
Join date : 2009-04-11
eBay: Auctions to the Common People
I think eventually second-price auctions will outpace first-price auctions as the internet continues to evolve. As the world gets more and more connected, sites like eBay will be preferred over first-price auctions because of the nature of people. People shop online for convenience and even more pertinent, to get things cheaper. eBay would have no customers if people preferred to pay their value for an item. But people want to save money and therefore second-price auctions will eventually outpace first-price auctions, especially in economic states such as the one we are in. Why would someone pay their value for an item when they could say, get the same item for a quarter of the value they place on it by going on eBay. It doesn't cost anything if you don't win the item, so you have nothing to lose and everything to gain by going with second-price auctions. So buyers are not the limiting factors, perhaps first-price auctions are still preferred because the seller gets more money for his item than putting it up on eBay?
wizeguy- Posts : 33
Join date : 2009-04-11
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