Asymmetric auctions with resale: An experimental study

We present results from an experiment based on Hafalir and Krishna’s (2008) model of auctions with resale. As predicted weak bidders bid more with resale than without, so that resale raises average auction prices. When the equilibrium calls for weak types to bid higher than their values with resale they do, but not nearly as much as the theory predicts. When the equilibrium calls for weak bidders to bid at or below their value with resale, outcomes are much closer to the risk neutral Nash model’s predictions. Keywords: Auctions, resale, experiment. JEL classi…cation: D44, C90 Research has been partially supported by a grant number ITR-0427770 and SES-0451981 from the National Science Foundation. We thank Isa Hafalir and Vijay Krishna for helpful comments. Any opinions, …ndings and conclusions or recommendations in this material are those of the authors and do not necessarily re‡ect the views of the National Science Foundation.