Snipe S/W?

From: Mike Kenzie <KenzieM_at_sympatico.ca>
Date: Wed Dec 20 22:45:22 2000

----- Original Message -----
From: "William Fulmor" <wpfulmor_at_dimensional.com>
To: <classiccmp_at_classiccmp.org>
Sent: Wednesday, December 20, 2000 11:35 PM
Subject: Re: Snipe S/W?


> On Wed, 20 Dec 2000, Sellam Ismail wrote:
>
> > This argument assumes that the eBay method of auctions
has been around
> > forever, which it has not. eBay's auction format is
something completely
> > new, and is completely biased towards the seller.

> [...]
>
> In naming him for the 1996 Nobel Prize, the selection
committee
> specifically cited his novel approach to auctioneering
(now known
> as a Vickrey auction), which, through sealed bidding,
awards the
> auctioned item to the highest bidder but at the sum bid
by the
> second-highest bidder. According to Vickrey, in
guaranteeing the lower
> price, both buyers and sellers benefit from bids that
more accurately
> reflect the value of the item.
>

> I have no idea if eBay selected Vickrey's model, or
duplicated it by
> accident, but AFAICT the only difference between theirs
and his is that
> with eBay, the winner pays one bid increment above the
runner up's bid,
> instead of exactly the lower bid.

The ebay auctions are not sealed, which results in higher
bids, and people placing multiple bids. With a sealed bid
auction no one knows the outcome until the envelopes are
opened and the winning amount read. With the Vickery
auction the high bidder doesn't know the price until all the
bids have been read.


> Is this O/T, or what?

yup
Received on Wed Dec 20 2000 - 22:45:22 GMT