Subject:
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Re: When is "Not an Auction" really an auction?
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Newsgroups:
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lugnet.market.theory
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Date:
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Fri, 3 Dec 1999 00:14:28 GMT
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Viewed:
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360 times
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In lugnet.market.theory, Chris Ernest Hall writes:
> I would agree with this for a single-time sale. But for multiple items
> (like a securities auction, which is something I've learned a little bit
> about in the last year) sealed-bid auctions are perfectly reasonable for
> some types of transactions.
The gray gets grayer -- and, if I'm understand you correctly, then -- WOW.
So (this is a question) there are types of sales in which each sale in an
of itself isn't really an auction (because people aren't competing and
counter-bidding), but which, when multiple identical (or very similar) sales
are run in succession (or many overlapping, giving the illusion of
succession), has the same end-effect as an auction? That is, even though
the bids are sealed, people are competing against one another by competing
against the last closed deal, because the final price is published?
That's wild. That's so gray (as in not black & white), it makes this
mathgeek's brain both reel and hurt at the same time. :-) Is that an
auction or isn't it? Wow. On the minor scale, it isn't, but on the major
scale, it is. Coolness.
> But a sealed-bid auction for something like a single Lego set is pretty
> silly. And the temptation by the seller (and the knowledge of this by the
> bidder) to play favorites or other games makes it even more suspect.
Yeah, I totally agree with that. Unless the seller publishes all of the
bids at the end (in which case I guess it wouldn't really be a "sealed-bid
auction" anymore), the bidders can never really be sure how the seller
actually chose the "high bid." And add to that other fuzzy things like
how much business (i.e., trust) a seller has done with a given bidder, or
whether the buyer & seller live in the same or different countries, etc.,
and it gets even more subjective. I always thought auctions were supposed
to be 100% objective: money talks, and nothing else.
> Seeing other people's bidding builds interest and makes it much harder to
> miss the auction. This makes it much more likely that the most efficient
> price is reached, which is better for both the buyers and sellers.
Yup!
(Except that some buyers hate the spirit behind an auction (making other
people compete to obtain the highest price) and some buyers don't
necessarily trust the seller to tell the truth about the other bidders, or
not to use a shill, etc. So having both types (auctions & negotiated or
straight sales) is much better IMHO than having only one type.)
--Todd
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Message is in Reply To:
 | | Re: When is "Not an Auction" really an auction?
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| (...) I would agree with this for a single-time sale. But for multiple items (like a securities auction, which is something I've learned a little bit about in the last year) sealed-bid auctions are perfectly reasonable for some types of (...) (25 years ago, 2-Dec-99, to lugnet.market.theory)
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