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Does Higher Transparency Lead to More Search in Online Auctions?
Author(s) -
Haruvy Ernan,
Popkowski Leszczyc Peter T. L.,
Ma Yu
Publication year - 2014
Publication title -
production and operations management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.279
H-Index - 110
eISSN - 1937-5956
pISSN - 1059-1478
DOI - 10.1111/j.1937-5956.2012.01357.x
Subject(s) - common value auction , transparency (behavior) , price dispersion , microeconomics , computer science , forward auction , economics , auction theory , computer security
In a controlled field experiment, we examine pairs of auctions for identical items under different conditions. We find that auction design features that are under the control of the auctioneer—including information transparency, number of simultaneous auctions, and the degree of overlap between simultaneous auctions—affect bidder search and choice. Clickstream data show that a significant relationship between information transparency and price dispersion can be linked to search. Specifically, the effect of information transparency on price dispersion is fully mediated by lookup behavior . Combining these findings, we make auction design recommendations regarding the provision of product and value information.