Response Times in the Wild: eBay Sellers Take Hours Longer to Reject High Offers and Accept Low Offers

26 Pages Posted: 15 Mar 2021

See all articles by Miruna Cotet

Miruna Cotet

Ohio State University (OSU)

Ian Krajbich

Ohio State University (OSU) - Department of Psychology; Ohio State University (OSU) - Department of Economics

Date Written: March 14, 2021

Abstract

Hesitation in the marketplace has the potential to betray private information. Recent results from lab experiments have confirmed that subjects’ response times reveal their strength-of-preference or belief, even in strategic settings. What remains unclear is whether these results extend beyond the lab to markets with experienced agents. Here we address this question using a dataset consisting of millions of bargaining exchanges from eBay. We find that the time it takes sellers to accept or reject offers is strongly related to the size of the offer. Sellers are quick to accept good offers and to reject bad offers, and slow to accept bad offers and to reject good offers. These response-time differences are on the order of hours. These findings apply to a majority of the exchanges on eBay, and are even stronger with more experienced sellers. Overall, these results indicate that there is information in response-time data from non-lab markets, and that a majority of agents do not have prepared strategies but instead evaluate offers on the spot in a way that reveals their values for the goods.

Keywords: response time, bargaining, decision making, reaction time, drift diffusion model, random utility model

JEL Classification: C70, C81, D01, D03, D82, D83, D87

Suggested Citation

Cotet, Miruna and Krajbich, Ian, Response Times in the Wild: eBay Sellers Take Hours Longer to Reject High Offers and Accept Low Offers (March 14, 2021). Available at SSRN: https://ssrn.com/abstract=3804578 or http://dx.doi.org/10.2139/ssrn.3804578

Miruna Cotet

Ohio State University (OSU) ( email )

Blankenship Hall-2010
901 Woody Hayes Drive
Columbus, OH OH 43210
United States

Ian Krajbich (Contact Author)

Ohio State University (OSU) - Department of Psychology ( email )

1835 Neil Avenue
Columbus, OH 43210
United States

Ohio State University (OSU) - Department of Economics

Arps Hall
1945 N. High St.
Columbus, OH OH 43210
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
178
Abstract Views
787
Rank
268,578
PlumX Metrics