Download This PaperIdentification of First-Price Auctions with Biased Beliefs
FEDS Working Paper No. 2015-056
http://dx.doi.org/10.17016/FEDS.2015.056
45 Pages Posted: 19 Aug 2015
Date Written: May 14, 2015
Abstract
This paper exploits variation in the number of bidders to separately identify the valuation distribution and the bidders' belief about the valuation distribution in first-price auctions with independent private values. Exploiting variation in auction volume the result is extended to environments with risk averse bidders. In an illustrative application we fail to reject the null hypothesis of correct beliefs.
Keywords: Biased Beliefs, First-Price Auction, Nonparametric Identification, Risk Aversion
JEL Classification: C57, D83, D44
Suggested Citation: Suggested Citation
Serafin Grundl (Contact Author)
Board of Governors of the Federal Reserve System ( email )
20th Street and Constitution Avenue NW
Washington, DC 20551
United States
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