Starting high or low in English auctions? The case of frozen saithe in Norway

Summary

This study investigates the role of starting prices in
sequentially ascending (English) auctions. Applying
binary logit and hedonic price models on a unique data
set comprising 8217 auctioned lots of frozen saithe, an
important species in Norwegian fisheries, we find support
for three hypotheses; that low starting prices will lead to a
higher share of successful auctions, a higher number of
participating bidders, and higher final prices. These
results indicate that starting prices in English auctions
are important for both seller revenue and auction
efficiency and are important with respect to strategic
behavior in auction markets for food commodities.

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DOI : doi.org/10.1002/jaa2.123
NVA : hdl.handle.net/11250/3134217