Shared Agents and Competition in Laboratory English Auctions

11 Pages Posted: 2 Apr 2020

See all articles by Dale J. Menkhaus

Dale J. Menkhaus

University of Wyoming

Owen R. Phillips

University of Wyoming

Kalyn T. Coatney

U.S. Department of Agriculture - Competition Unit - Grain Inspection, Packers and Stockyards Administration

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Date Written: November 2003

Abstract

At livestock auctions, the same purchasing agent can represent more than one processor. Repeated multiple‐unit English auctions are created in a laboratory to measure the impact of shared agents on trade prices under alternative treatments with six, and as few as two, agents representing six principals. Treatments are constructed in which the agents either know or do not know quantity for sale, and in which there are progressively fewer agents bidding. Knowledge of quantity for sale can be anticompetitive. Evolution toward increased market concentration leads to consistent anticompetitive pricing, resulting in prices significantly lower than the predicted competitive equilibrium prices.

Keywords: English auction, laboratory market, shared agents

Suggested Citation

Menkhaus, Dale J. and Phillips, Owen R. and Coatney, Kalyn T., Shared Agents and Competition in Laboratory English Auctions (November 2003). American Journal of Agricultural Economics, Vol. 85, Issue 4, pp. 829-839, 2003, Available at SSRN: https://ssrn.com/abstract=3566367 or http://dx.doi.org/10.1111/1467-8276.00491

Dale J. Menkhaus (Contact Author)

University of Wyoming ( email )

Box 3434 University Station
Department of Applied Agricultural Economics
Laramie, WY 82071
United States
307-766-5128 (Phone)
307-766-5544 (Fax)

Owen R. Phillips

University of Wyoming

Box 3434 University Station
Laramie, WY 82070
United States

Kalyn T. Coatney

U.S. Department of Agriculture - Competition Unit - Grain Inspection, Packers and Stockyards Administration

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Aurora, CO 80011
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