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ERIC Number: EJ858530
Record Type: Journal
Publication Date: 2009
Pages: 20
Abstractor: As Provided
Reference Count: 35
ISBN: N/A
ISSN: ISSN-0276-8739
Collusion in Auctions for Emission Permits: An Experimental Analysis
Burtraw, Dallas; Goeree, Jacob; Holt, Charles A.; Myers, Erica; Palmer, Karen; Shobe, William
Journal of Policy Analysis and Management, v28 n4 p672-691 Fall 2009
Environmental markets have several institutional features that provide a new context for the use of auctions and that have not been studied previously. This paper reports on laboratory experiments testing three auction forms--uniform and discriminatory price sealed-bid auctions and an ascending clock auction. We test the ability of subjects to tacitly or explicitly collude in order to maximize profits. Our main result is that the discriminatory and uniform price auctions produce greater revenues than the clock auction, both with and without explicit communication. The clock appears to facilitate successful collusion, both because of its sequential structure and because it allows bidders to focus on one dimension of cooperation (quantity) rather than two (price and quantity). (Contains 15 footnotes, 6 tables, and 6 figures.)
John Wiley & Sons, Inc. Subscription Department, 111 River Street, Hoboken, NJ 07030-5774. Tel: 800-825-7550; Tel: 201-748-6645; Fax: 201-748-6021; e-mail: subinfo@wiley.com; Web site: http://www3.interscience.wiley.com/browse/?type=JOURNAL
Publication Type: Journal Articles; Reports - Research
Education Level: N/A
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A