Selling Online versus Live
California Institute of Technology - Control & Dynamic Systems
Stanford Graduate School of Business; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)
Journal of Industrial Economics, Vol. 53, No. 4, pp. 543-569, December 2005
A seller choosing between auctioning online and live faces a tradeoff: lower transaction costs online against more rents left with the bidders. We model this tradeoff, and apply the theory to auctions of art. The crucial parameter for whether the seller does better online than live is not the expected price but the valuation uncertainty.
Number of Pages in PDF File: 27Accepted Paper Series
Date posted: January 3, 2006
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