Online Auction Markets Before and During the Lockdown

Abstract

We use a novel dataset on more than 35,000 eBay auctions for electronics to analyse Covid19-induced lockdown effects. The dataset covers pre- and lockdown periods and, for each auction, contains both auction settings fixed by the seller and the whole bidding record. The interplay of agents reactions has led to an overall equilibrium price decrease, with some heterogeneity across brands and products. We identify a mechanism that partially explains this decrease. Sellers in eBay choose the ending day of their auctions. The most selected day of the week in the pre-lockdown was less selected that most selected one during the lockdown. That increased the competition among auctions. Our regression analysis delivers statistically significant evidence of a negative impact of that competition on the stop-out prices precisely for products and brands which had a larger price decrease, which presumably coincide with those with a broader set of close substitutes. The effect of other variables on prices, either related to bidding behavior or to eBay specificities is discounted.

Keywords: auction, Covid, eBay, electronics, lockdown

JEL Classification: C57, D44, D83, D91, I18