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Subject: 
Re: Proxy ratcheting: How do auction systems work?
Newsgroups: 
lugnet.market.auction
Date: 
Wed, 21 Apr 1999 07:08:24 GMT
Viewed: 
967 times
  
The bidding mechanism also has some new functionality.

Assume the current lot is open with no bids and a $10 minimum.  Next, assume it
is an Airport Shuttle - built once.

I make a firm bid of $150, fine.  I then make a proxy bid of $400.  The net
result is I now have a proxy bid at $150 with a max of $400.

Then the phone bill comes.  I'm feeling a bit poor.  Now I make a firm bid of
$200.  Net result - I have a firm bid of $200.  I put a STOP order on my proxy.

Then I win the lottery, and submit a proxy bid of $600.  Net result: a proxy
bid of $200 with a max of $600.

I sure hope somebody can appreciate this  ;-)

Derick




In lugnet.market.auction, Derick Bulkley writes:
Larry,
I must protest!  In designing the system, I wanted first of all to allow firm
bidding - which is an important signialing tool in an auction.  But the
'common' rules in proxy-only auctions would have bestowed every advantage upon
the proxy bid, leaving the firm bid all but impotent. I took it upon myself to
allow an advantage to the firm bid, via the 'disadvantage' to the proxy in • case
3.   Further, the whole sniping issue is moot: the beauty of the non-timed
auction is that it promotes the dissemination of information, by ensuring that
late information - a last minute bid - is not allowed to determine the • outcome.
Therein lies what I beleive to be the ugliness of timed auctions - they
discourage bidders from revealing information (how they value a given lot)
until as late as possible.  Don't get me wrong - timed auctions are a • brilliant
method of creating excitement about otherwise mundane merchandise - it's just
that I abhor the idea that people believe it is the only way to run an auction
on the internet.

sorry if the typing's off, it's been a *really* long day..

Derick


As to Derick's scenario 3, lo these many appends back, I think his
system is OK but his rules are broken. Same as eBay, same reason.

Derick, change it now while you can, before it gets baked into
expectations of many many bidders. Remember, one of your selling points
is that you're different than eBay. Cherish that difference. Here is
another place for you to shine, brightly.

1 - a point to note (and this relates to libertopia, too...) life is not
fair. No system can guarantee fairness under any circumstances (consider
major asteroid strikes and their impact on auctions under way, for
example). But systems can, and should, do all they can to be fair.

--
Larry Pieniazek    http://my.voyager.net/lar
FDIC Know your Customer is wounded, thanks to you, but not dead...
See http://www.defendyourprivacy.com for details
For me: No voyager e-mail please. All snail-mail to Ada, please.
- Posting Binaries to RTL causes flamage... Don't do it, please.
- Stick to the facts when posting about others, please.
- This is a family newsgroup, thanks.



Message has 2 Replies:
  Re: Proxy ratcheting: How do auction systems work?
 
(...) Well, I can appreciate the technical elegance but I'm not sure I think this is a good thing or not. Basically you're saying that as a bidder, you can retract the "secret" part of your bid, as long as it hasn't been revealed yet. In your (...) (26 years ago, 21-Apr-99, to lugnet.market.auction)
  Re: Proxy ratcheting: How do auction systems work?
 
(...) it (...) proxy. (...) So in a similar scenario to the one Larry's pointed out - if I come along with a $200 firm bid (and a $250 maximum) just before your phone bill arrives, then I don't get the shuttle, and your firm bid shoots up to $250. (...) (26 years ago, 21-Apr-99, to lugnet.market.auction)

Message is in Reply To:
  Re: Proxy ratcheting: How do auction systems work?
 
Larry, I must protest! In designing the system, I wanted first of all to allow firm bidding - which is an important signialing tool in an auction. But the 'common' rules in proxy-only auctions would have bestowed every advantage upon the proxy bid, (...) (26 years ago, 21-Apr-99, to lugnet.market.auction)

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