Replication data for: Sophisticated Bidders in Beauty-Contest Auctions
- Galavotti, Stefano
- Moretti, Luigi
- Valbonesi, Paola
AbstractWe study bidding behavior by firms in beauty-contest auctions, i.e., auctions in which the winning bid is the one which gets closest to some function (average) of all submitted bids. Using a dataset on public procurement beauty-contest auctions, we show that firms' observed bidding behavior departs from equilibrium and can be predicted by a "sophistication" index, which captures the firms' capacity of bidding close to optimality in the past. We show that our empirical evidence is consistent with a Cognitive Hierarchy model of bidders' behavior. We also investigate whether and how firms learn to bid strategically through experience.
Is supplement to
DOI: 10.1257/mic.20150240 (Text)
Galavotti, Stefano, Luigi Moretti, and Paola Valbonesi. “Sophisticated Bidders in Beauty-Contest Auctions.” American Economic Journal: Microeconomics 10, no. 4 (November 2018): 1–26. https://doi.org/10.1257/mic.20150240.
- ID: 10.1257/mic.20150240 (DOI)
Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-10-13