Subject:
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Re: Proxy ratcheting: How do auction systems work?
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Newsgroups:
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lugnet.market.auction
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Date:
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Wed, 21 Apr 1999 23:45:45 GMT
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Viewed:
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906 times
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In lugnet.market.auction, jdiri14897@email.msn.com (John DiRienzo) writes:
> > Steve Bliss writes:
> > > About the issue of whether new bids have to beat the proxy by the
> > > increment amount, I say this: as long as I can't be sniped at the
> > > last minute, I don't care. If someone beats me by a small amount
> > > or a large amount, if I'm still willing to bid higher, I will.
> > > But if I don't have time to make another bid, I (and the seller)
> > > are effectively screwed.
>
> Now wait, screwed by who?
Apparently screwed by the other bidder, but actually screwed by the broken
auction system.
> To blame the auction system is just a way of
> shifting the blame - you knew before hand when the auction would end and
> could at any time have raised your proxy, if you were willing to pay more.
> You are aware that its likely someone will at least attempt to outbid you in
> the last few minutes of the auction. Maybe you "screwed" yourself and the
> seller, but the auction system is not to blame.
It is correct to blame the auction system. Humans in general will by their
nature do whatever they can to work any system to their personal advantage.
A system which encourages humans to frustrate each other (like eBay, for
example) is broken.
> Larry Pieniazek writes:
> > Really?
> > Consider this scenario that could happen at SeriousCollector
> > You have an item won, sitting at 400, and your max proxy is 500. Someone
> > outbids you with a hard bid of 500.01 (lucky guess on their part) which
> > gets rounded to 500.50 under the rounding rules (as I understand them)
> > The bid increment is 15%. Are you willing to take the item to 575 or
> > thereabouts to win it back? Why should you have to spend 75 bucks to top
> > them if they only spent 50 cents to top you?
> > Remember, SC uses fixed percentage bid increments. It's early in the
> > life of the site, Bev is sharp and Derick is eager to please. Let's
> > thrash this out now.
>
> I just wrote a very long spiel about the error in forced minimum
> increments.
I read it, but didn't see anything except false assumptions.
> [...]
> > > So the problem with eBay once again come back to the fact that
> > > it is based on fixed ending times.
> >
> > Well, that's ONE of the problems.
>
> Some see it as a problem, however, if you place your bid before the auction
> ends, in the amount you are willing to pay, you should either get the item
> or someone else will get it for a higher price. Thats how all auctions are,
> right?
The concept of "how much you are willing to pay" is an EXTREMELY flawed
concept. This was hashed out a few months ago in great detail. If you
truly want to understand how horribly flawed the concept is, think about
cases where you are bidding on multiple lots that all close at roughly the
same time but you have only a finite supply of money.
> To some, especially sellers, the beauty of eBay is that they know
> when the auction will end.
This is nice for sellers. On the other hand, it's somewhat limiting as
well. Can a seller choose to extend the length of an auction on eBay if
they decide they'd like it to run for a few more days?
> There will always be varied opinions on this,
> since you can't have it both ways. I tend to look at it more like a live
> auction. You go to an auction, hang out til what interests you is being bid
> on and then bid on it. You don't bid a week in advance, and you don't call
> in a new bid every couple days. Its much simpler and faster this way. Most
> eBay auctions go for a week, so you have a whole week to browse, decide what
> to bid on and then, near the end, place your bid. Fortunately, if you
> aren't going to be able to bid at the end, you can place a proxy ahead of
> time, which is exactly like leaving your friend in the auction house to bid,
> in case you have to go outside for some fresh air.
Leaving your friend behind to close the deal is no better than a proxy bid
unless you and your friend have a telepathic link, or your friend is capable
of making the identical last-minute judgment calls and decisions that you
would have made had you been there. If the bidding is currently at $150 and
you've instructed your friend to fight for you up to $300 but no higher,
your friend might actually -not- go to $305 when you would have actually
gone to $310 in the heat of battle. On the other hand, your soul mate,
knowing how much you -really- want the item, might go to $320 for you,
putting in $20 of his own money to round it out.
The problem with proxy bidding is that proxy bids are not your soul mate.
They're not even a good friend. They're just a number.
Which is not to say that proxy bidding is a bad thing, it's just not a very
useful thing in fixed-ending-time auctions. What you really need is an
extremely intelligent bidding agent who thinks as you do. (Maybe in 2025
we'll have stuff like this :)
> [...]
> For the other point about retracting a proxy, and replacing it with a
> firm bid, I still disagree. I do not understand the advantage of having two
> types of bids in one auction. Somebody enlighten me.
I think you're letting yourself get confused by the words/labels. There
aren't two types of bids. One is just a special case of the other, a more
general type of bid.
> Anyway - again, on
> eBay, it does say you can never retract a bid as you place your bid.
> However, if you have a dire emergency, and contact the seller prior to the
> end of auction, the seller himself can cancel your bid. Even if the auction
> has ended, the majority of eBay's (and other auction's) sellers are human
> beings, and understand the plights of fellow men, and will work with a
> person who has sudden financial distress. :-) So, the reasoning behind
> being able to remove a prior bid seems useless.
It is not removing a prior bid. It is decreasing (or increasing, for that
matter) the value of y in the ordered pair (x,y), where x is the minimum
you're willing to pay, and y is the [secret] maximum that you're willing to
pay. You're saying, "Yesterday I was willing to pay anywhere from $100 to
$200 to get this, but today I'm willing to pay anywhere from $100 to $150."
The constraint, of course, is that you can't lower y below the current
standing bid.
> I can't say that its a
> better or worse method, just different, but would like to know how others
> see it as a better method.
One thing's for sure -- allowing it is either a positive impact or no
impact. It cannot be a negative impact, for it does no harm whatsoever to
anyone as it is effecting a change in a private value known only to the
bidder and not to other bidders. Any attempt to determine the unknown value
by mischievous other bidders exhibits Heisenberg properties. :)
--Todd
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