Essays on economic behavior, focusing and auctions

Research output: ThesisDoctoral Thesis (compilation)

Abstract

This thesis contributes to research on experimental and behavioral economics as well as auction theory. It consists of five papers.

The first paper, Differences Attract: An Experimental Study of Focusing in Economic Choice, studies whether individuals' decisions are affected by focus effects. The focus effect suggests that individuals focus more on an attribute that has a larger difference among the available consumption options. This leads in turn to the observation that individuals overweigh such attributes and are thus more likely to choose a consumption option if the choice set displays a large difference in its strongest attribute. This experimental study finds that individuals do display a focusing bias. This bias is also contrasted by the decoy (attraction) effect in the study. The results suggest that the focusing effect is stronger than the decoy effect.

The second paper, Visual Attraction: Modes of Presentation and Focusing in Economic Choice, examines whether the focus effect found in the first paper is affected by the visual interface. Specifically, we present options either by bar graphs or in tables. We find a strong focus effect when options are presented as bar graphs, but no such effect when the options are presented in a table.

The third paper, Shill Bidding and Information in Sequential Auctions: A Laboratory Study, studies the effects of shill bidding, which occurs when sellers bid on their own item in order to increase its price. We also study the effect of providing shill bidding sellers with the bidding history from previous auctions. Using two sequential auctions in each round of the experiment, the study finds that shill bidding affects bidders' behavior and outcomes. However, the amount of information provided to the shill bidding sellers has no important effects.

The fourth paper, An Auction with Approximated Bidder Preferences - When an Auction has to be Quick, provides a solution to the problem of accommodating bidders' possible non-quasi-linear preferences in a quick combinatorial auction setting. The solution is based on a method for approximating bidders' preferences. It is shown that an equilibrium always exists under a certain condition and a process for finding the minimum approximated Walrasian price vector is provided.

The fifth paper, A Method for Finding the Maximal Set in Excess Demand, provides a computationally improved process for finding an equilibrium in the partnership formation problem. The method builds on finding the set of agents who are in maximal excess demand, then raises the payoffs of these. The process is shown to always stop at the minimum Walrasian price vector.

Details

Authors
  • Jim Ingebretsen Carlson
Organisations
Research areas and keywords

Subject classification (UKÄ) – MANDATORY

  • Economics

Keywords

  • Attention, focusing, experiments, auctions, shill bidding, approximated preferences, partnership formation
Original languageEnglish
QualificationDoctor
Awarding Institution
Supervisors/Assistant supervisor
Award date2018 May 22
Place of PublicationLund
Print ISBNs978-91-7753-602-4
Electronic ISBNs978-91-7753-603-1
Publication statusPublished - 2018 Apr 9
Publication categoryResearch

Bibliographic note

Defence details Date: 2018-05-22 Time: 14:15 Place: Holger Crafoord Centre EC3:210 External reviewer Name: Miettinen, Topi Title: Professor Affiliation: Hanken School of Economics ---