Women and Men Are Different But Equal: Observations of Learning Behavior in Auctions

11 Pages Posted: 8 Aug 2015

See all articles by Dinah Pura T. Depositario

Dinah Pura T. Depositario

University of the Philippines Los Baños - Department of Agribusiness Management

Rodolfo M. Nayga

University of Arkansas - Dale Bumpers College of Agricultural, Food and Life Sciences; Norsk institutt for landbruksøkonomisk forskning (NILF)

Yu Yvette Zhang

Texas A&M University

Date Written: August 6, 2015

Abstract

We examined gender differences in bidding and learning behavior in Second Price Auctions (SPAs). Although bidding one’s true value is a weakly dominant strategy in SPAs, overbidding has been common and persistent in laboratory SPAs, i.e., bidding above one’s value. In our study, we found that inexperienced women overbid more than inexperienced men when they were provided with endowment money in the auctions. However, when participants were asked to bid using their own money, women became more cautious, bidding lower and closer to the optimal strategy (true value) even without experiences, while inexperienced men still deviated from the optimal strategy by overbidding significantly. As men gained more experiences, they learned from costly overbidding and eventually lowered their bids to the same level as those of women’s bids. In conclusion, we found that although women and men initially behaved differently in SPAs, both genders would eventually bid according to the optimal strategy and obtain the same outcome given sufficient learning experiences.

Keywords: Gender differences, Learning, Second Price Auctions, Experiments

JEL Classification: C91, D44, J16

Suggested Citation

Depositario, Dinah Pura T. and Nayga, Rodolfo M. and Zhang, Yu Yvette, Women and Men Are Different But Equal: Observations of Learning Behavior in Auctions (August 6, 2015). Available at SSRN: https://ssrn.com/abstract=2640662 or http://dx.doi.org/10.2139/ssrn.2640662

Dinah Pura T. Depositario

University of the Philippines Los Baños - Department of Agribusiness Management ( email )

College of Economics and Management
UPLB
Los Baños, Laguna 4031
Philippines

Rodolfo M. Nayga

University of Arkansas - Dale Bumpers College of Agricultural, Food and Life Sciences ( email )

United States

Norsk institutt for landbruksøkonomisk forskning (NILF)

NO-0030 Oslo
Norway

Yu Yvette Zhang (Contact Author)

Texas A&M University ( email )

College Station, TX 77843
United States

HOME PAGE: http://agecon2.tamu.edu/people/faculty/zhang-yvette/

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