An Empirical Perspective on Auctions

We describe the economics literature on auction markets, with an emphasis on the connection between theory, empirical practice, and public policy, and a discussion of outstanding issues. We describe some basic concepts, to highlight some strengths and weaknesses of the literature, and so indicate where further research may be warranted. We discuss identi…cation and estimation issues, with an emphasis on the connection between theory and empirical practice. We also discuss both structural and reduced form empirical approaches. Keywords: auctions, bidding, identi…cation, estimation, collusion, bid rigging. Forthcoming in the Handbook of Industrial Organization (Vol. III), edited by M. Armstrong and R. Porter. We are grateful to Mark Armstrong, Phil Haile, Jakub Kastl, Paul Klemperer and Harry Paarsch for helpful comments.