Experience Weighted Attraction in the First Price Auction and Becker Degroot Marschak
Fordham University Department of Economics Discussion Paper No. 2008-04
39 Pages Posted: 4 Mar 2008 Last revised: 26 May 2008
Date Written: February 1, 2008
In this paper we explore the performance of Experience Weighted Attraction (EWA) in two different auction institutions: First Price Sealed Bid, and Becker-DeGroot-Marschak. Our results suggest that learning has some promise as a possible explanation for previously documented cross-institutional choice anomalies usually attributed to risk aversion. Additionally, we present results on the likely econometric (ir)recoverability of EWA parameters in these institutions.
Keywords: Auctions, Risk Aversion, Learning, Experience Weighted Attractions
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