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Teams and individuals in standard auction formats: decisions and emotions

Published online by Cambridge University Press:  14 March 2025

Maria Karmeliuk*
Affiliation:
Novosibirsk State University, Novosibirsk, Russia
Martin G. Kocher*
Affiliation:
University of Vienna, Vienna, Austria University of Gothenburg, Gothenburg, Sweden
Georg Schmidt*
Affiliation:
University of Vienna, Vienna, Austria

Abstract

Our study compares individual and team bidding in standard auction formats: first-price, second-price and ascending-price (English) auctions with independent private values. In a laboratory experiment, we find that individuals overbid more than teams in first-price auctions and deviate more from bidding their own value in second-price auctions. However, we observe no difference in bidding behavior in English auctions. Based on control variables, we provide evidence that the observed difference could be explained by better reasoning abilities of teams. Emotions seem to play a role in determining bids, but the effect of emotions on bidding does not differ between individuals and teams.

Type
Original Paper
Copyright
Copyright © The Author(s), under exclusive licence to Economic Science Association 2022.

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Footnotes

Supplementary Information The online version contains supplementary material available at https://doi.org/10.1007/s10683-022-09769-4.

Financial support by Deutsche Forschungsgemeinschaft through CRC TRR 190 (project number 280092119) is gratefully acknowledged. We are grateful to Fangfang Tan for very helpful comments and to two anonymous referees and the editor whose suggestions improved the paper a lot. The replication material for the study is available at: https://doi.org/10.5281/zenodo.6946038.

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