Frictions in Internet Auctions with Many Traders: a Counterexample
Economics Letters, 138, 81-84, joint with J. Donna and P. Schenone.


Abstract
We show that when frictions are present, the Peters and Severinov (2006) (PS) bidding rule is no longer efficient nor a PBE of the PS game. Researchers should be cautious when using the PS bidding rule in markets with frictions like eBay.


Donna, Javier, Pablo Schenone, and Gregory Veramendi (2016): "Frictions in Internet Auctions with Many Traders: a Counterexample," Economics Letters, 138, 81-84.

Last modified 2/2017