Selling Online Versus Live

27 Pages Posted: 3 Jan 2006

See all articles by Eiichiro Kazumori

Eiichiro Kazumori

California Institute of Technology - Control & Dynamic Systems

John McMillan

CESifo (Center for Economic Studies and Ifo Institute)

Abstract

A seller choosing between auctioning online and live faces a tradeoff: lower transaction costs online against more rents left with the bidders. We model this tradeoff, and apply the theory to auctions of art. The crucial parameter for whether the seller does better online than live is not the expected price but the valuation uncertainty.

Suggested Citation

Kazumori, Eiichiro and McMillan, John, Selling Online Versus Live. Journal of Industrial Economics, Vol. 53, No. 4, pp. 543-569, December 2005. Available at SSRN: https://ssrn.com/abstract=870635 or http://dx.doi.org/10.1111/j.1467-6427.2005.00269.x

Eiichiro Kazumori (Contact Author)

California Institute of Technology - Control & Dynamic Systems ( email )

Pasadena, CA 91125
United States

John McMillan

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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