Auctioning Böhm-Bawerk's horses

Andrew Schotter

    Research output: Contribution to journalArticle

    Abstract

    Auctions are a unique allocating device of great practical importance. They present situations that cannot easily be fit into the neat taxonomy of Neoclassical Economic Analysis. For instance, textbook theory tells us that a market with one seller and many buyers is a monopolistic market structure. But what if the seller is passive as he is in the Auction? Does this situation still qualify as a monopolistic situation with all of the typical connotations that that term implies? Obviously not. In addition, our textbooks tell us that price discrimination is the result of the profit maximizing behavior of monopolies. However, we have seen that buyers in a competitive bidding process can very naturally discriminate the price of the good they are bidding for on their own. Is a single price for a homogeneous good then still evidence of a "competitive" process? These questions and several others were raised in this paper and, I hope, dealt with in a satisfactory manner. The point that must be stressed, however, is that the auctioning process is an extremeley complex subject, and in light of its empirical significance, must be met with far more analysis than economists have offered in the past.

    Original languageEnglish (US)
    Pages (from-to)195-215
    Number of pages21
    JournalInternational Journal of Game Theory
    Volume3
    Issue number4
    DOIs
    StatePublished - Dec 1974

    Fingerprint

    Bidding
    auction
    Auctions
    textbook
    Economic Analysis
    market
    Taxonomy
    monopoly
    taxonomy
    economist
    Discrimination
    Profit
    profit
    discrimination
    Imply
    present
    Term
    evidence
    economics
    Market

    ASJC Scopus subject areas

    • Statistics and Probability
    • Mathematics (miscellaneous)
    • Social Sciences (miscellaneous)
    • Economics and Econometrics
    • Statistics, Probability and Uncertainty

    Cite this

    Auctioning Böhm-Bawerk's horses. / Schotter, Andrew.

    In: International Journal of Game Theory, Vol. 3, No. 4, 12.1974, p. 195-215.

    Research output: Contribution to journalArticle

    Schotter, Andrew. / Auctioning Böhm-Bawerk's horses. In: International Journal of Game Theory. 1974 ; Vol. 3, No. 4. pp. 195-215.
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