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A Comment on “Can Relaxation of Beliefs Rationalize the Winner's Curse?: An Experimental Study”
Author(s) -
CostaGomes Miguel A.,
Shimoji Makoto
Publication year - 2015
Publication title -
econometrica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 16.7
H-Index - 199
eISSN - 1468-0262
pISSN - 0012-9682
DOI - 10.3982/ecta11000
Subject(s) - curse , winner's curse , economics , mathematical economics , value (mathematics) , relaxation (psychology) , psychology , econometrics , positive economics , philosophy , mathematics , social psychology , statistics , theology
Ivanov, Levin, and Niederle (2010) use a common‐value second‐price auction experiment to reject beliefs‐based explanations for the winner's curse. ILN's conclusion, however, stems from the misuse of theoretical arguments. Beliefs‐based models are even compatible with some observations from ILN's experiment.