Abstract

http://ssrn.com/abstract=1293147
 
 

References (33)



 


 



Endogenizing Bidder’s Choice in Financial Assets Auctions – An Experimental Investigation


Menachem Brenner


New York University (NYU) - Department of Finance

Dan Galai


Hebrew University of Jerusalem - Jerusalem School of Business Administration

Orly Sade


Hebrew University of Jerusalem - Department of Finance

June 1, 2009

NYU Working Paper No. FIN-07-011

Abstract:     
Many financial assets, especially government bonds, are issued by an auction mechanism. An important feature of the design is the auction pricing mechanism: Uniform vs. Discriminatory. Theoretical papers do not provide a definite answer regarding the preference of one mechanism over the other. Experimental papers investigated the issue under an exogenous equal number of bidders. We investigate the bidders choice and the impact of that choice on the outcome of the auction by letting them choose between the two alternative systems. The majority of the bidders in the survey have chosen the uniform method. Those that prefer the uniform auction bid, on average, more aggressively than those that choose the discriminatory one. On average the revenues to the issuer were higher under the uniform price mechanism.

Number of Pages in PDF File: 34

working papers series


Download This Paper

Date posted: November 3, 2008 ; Last revised: October 18, 2009

Suggested Citation

Brenner, Menachem and Galai, Dan and Sade, Orly, Endogenizing Bidder’s Choice in Financial Assets Auctions – An Experimental Investigation (June 1, 2009). NYU Working Paper No. FIN-07-011. Available at SSRN: http://ssrn.com/abstract=1293147

Contact Information

Menachem Brenner (Contact Author)
New York University (NYU) - Department of Finance ( email )
Stern School of Business
44 West 4th Street
New York, NY 10012-1126
United States
212-998-0323 (Phone)
212-995-4233 (Fax)
Dan Galai
Hebrew University of Jerusalem - Jerusalem School of Business Administration ( email )
Mount Scopus
Jerusalem, 91905
Israel
972 2 5883235 (Phone)
972 2 5881341 (Fax)
Orly Sade
Hebrew University of Jerusalem - Department of Finance ( email )
Mount Scopus
Jerusalem, 91905
Israel
972 2 588 3227 (Phone)
Feedback to SSRN


Paper statistics
Abstract Views: 346
Downloads: 61
Download Rank: 210,742
References:  33

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo5 in 0.313 seconds