The High/Low Divide: Self-Selection by Values in Auction Choice

Most prior theoretical and experimental work involving auction choice has assumed bidders nd out their value after making a choice of which auction to enter. We examine whether or not bidders knowing their value prior to making a choice of which among multiple alternative auction formats to enter impacts their choice decision and/or the outcome of the auctions. The results show a strong impact on auction choice. Subjects with low values choose the \u85rst price sealed bid auction more often while subjects with high values choose the ascending auction more often. The number of bidders in each auction, revenue, e ¢ ciency and average bidder surplus all end up equalized. JEL Codes: C91, D4