Wine investment returns can come from overall market trends or price increases with age. Because of the short wine price histories available, market and maturation effects are difficult to separate. Consequently, researchers often obtain dramatically different estimates of investment returns. We find that data sample bias may be the hidden cause of the disparate estimates. In wine auction data, the sample bias refers to a shift in the distribution of which wines are traded as a function of their age. Such sample bias in panel data sampled across many different wine labels can distort the estimation of price increases versus age and consequently impact the estimation of market trends. This analysis shows that segmenting the analysis such that the data panels contain wine labels with similar trading characteristics can lead to a more stable estimation.

The analysis here looks at data from Bordeaux, Italy, Australia, and California. An Age-Period-Cohort (APC) analysis is applied to data panels from each region. Then the data in each region is segmented by a measure of popularity in order to reduce sampling bias. Data thus segmented is then re-analyzed to demonstrate the difference in estimating price appreciation lifecycles and market trends.

Produce that does not meet sellers’ esthetic standards may be redirected to alternative uses or wasted, but consumer trends indicate potential marketability of blemished produce. We conduct a nonhypothetical experimental auction to elicit consumer willingness-to-pay (WTP) for produce of varying degrees of blemish and test whether valuations are affected by (1) information on food waste resulting from grocery stores’ esthetic standards and (2) additional information on the environmental impacts of food waste. WTP for blemished produce increases as consumers become informed, but the information effects vary by blemishing degree. Market simulations indicate that introducing blemished produce can increase retailer revenue.

Economic experiments have been widely used to elicit individuals' evaluation for various commodities. Common elicitation methods include auction and posted price mechanisms. A field experiment is designed to compare willingness-to-pay (WTP) estimates between these two mechanisms. Despite both of these formats being theoretically incentive compatible and demand revealing, results from 115 adult consumers indicate that WTP estimates obtained from an auction are 32–39 percent smaller than those from a posted price mechanism. A comparison in statistical significance shows that auctions require a smaller sample size than posted price mechanisms in order to detect the same preference change. Nevertheless, the signs of marginal effects for different product characteristics are consistent in both mechanisms.

A breeding female’s perceived value is a complicated process and depends on a combination of expected production costs, reproductive success, and calf values. A conceptual asset value model based on female characteristics as signals and net implicit marginal value expectations is developed. A hedonic model based on sequentially sold individuals at multiple Mississippi auction locations is estimated by panel regression. Among other findings, pregnant females are discounted in proportion to abortion risk, which decreases toward birth. A follow-up cost/benefit analysis indicates producers are better off from at home pregnancy checking and selling only nonpregnant females or cow/calf pairs.

This study investigates the effects of material and symbolic quality attributes on the Cup of Excellence specialty coffee quality scores and prices. The estimates from the quality score equations suggest that material attributes are important determinants, but symbolic attributes have a greater explanatory power. The hedonic price estimations show that specialty coffee prices are mainly determined by symbolic attributes and market conditions such as the number of coffees in the auction. Overall, the study reveals that fruity, floral, sweet, spice, and sour acid are cuppers' and buyers' most favorite coffee flavors and aromas.

Companies that manage mandatory pension funds are frequently accused of excessive fee taking. International analyses have found that in countries with legal caps, commissions remain within these caps; hence, market competition does not function. Surprisingly, there are few international cases where local regulators implement mechanisms to facilitate competition. The variety of auction mechanisms available raises the question of whether an optimal solution exists for this purpose. Therefore, in this study, we present evidence, based on a controlled regulatory experiment, on the fee-reduction potential of reverse auctions.

Hedonic modeling of Oklahoma cow auction data is used to determine the market value of bred cow characteristics. We use Agricultural Marketing Service data that let us consider more years and more lots of cattle than is typical for a cattle hedonic study. The greatest price premiums were for black, late-gestating cows, categorized as high quality by market reporters and weighing between 1,600 and 1,700 lb. Previous research on optimal cow size finds much smaller-size cows are optimal, and our research finds that larger cows receive a lower price per pound but still receive a substantially higher price per head.

Farmland reallocation between farmers through rental transactions is critical for improving Japanese rice productivity. This study examined effects of socio-institutional and emotional factors as well as economic factors on rental transactions. A stochastic choice model was applied to contingent valuation data by considering regional heteroscedasticity. Empirical results showed (1) existence of economic inefficiencies, 3% loss of economic surplus due to socio-institutional restriction, which is probably reflected in transaction costs; (2) a 15% reduction in surplus due to emotional reluctance of farmers; and (3) strong influences of rice price, wages, and geographical location on the rental rate and agreement level.

The present article discusses general issues associated with experimental auctions and their relative advantages and disadvantages over other marketing research techniques. Experimental auctions create an active market environment with feedback where subjects exchange real goods and real money, which is not generally the case with other methods. The article also discusses four experimental design issues associated with experimental auctions: auction mechanism, market feedback and bidder affiliation, demand reduction and wealth effects, and multiple attribute valuation. Each of these experimental design issues, if not properly controlled, have the potential to create serious flaws in marketing recommendations.

We employed Vickrey auctions to generate willingness-to-pay (WTP) data forred meat traceability and related product characteristics with comparableexperimental auctions in the United States, Canada, the U.K., and Japan. Theresults show that subjects are willing to pay a nontrivial premium fortraceability, but the same subjects show even higher WTP fortraceability-provided characteristics like additional meat safety and humaneanimal treatment guarantees. The implication is that producers might be ableto implement traceable meat systems profitably by tailoring the verifiablecharacteristics of the product to consumer preferences.

Breeders of purebred bulls have multiple avenues to market their bulls, including consignment at public auctions associated with performance tests. Purebred breeders often have the opportunity to withdraw bulls that are eligible to sell in these auctions. We examine sales data from a public auction held in conjunction with a performance bull test in Tucumcari, NM, to gain insights on breeder decisions to withdraw bulls prior to entering the sales ring. Specifically, we use a binary logit model to identify relevant characteristics that affect a breeder's decision to withdraw a sale eligible bull from the auction.

Competition in a multi-unit auction is measured both by the number of bidders and by the relative size of their demands, compared to the number of units on sale. For the same degree of competition (identical aggregate demand and supply), we can observe different demand structures. Do they have an impact on the auction efficiency and revenue-raising properties? It is essential to understand better the impact of competition structure on performance in order to draw recommendations for the design of multi-unit auctions. Theoretical results demonstrate on a simple case contrasting a uniform-price auction of two bidders with a demand of 6 units each, and an auction of 6 bidders with a demand of two units each, that there are multiple equilibria leading to different performance outcome. Experiments are conducted to compare the performance of these two auctions. Results support that with a constant competition degree, the seller gets higher expected revenue with a lower variance when he faces a large number of bidders with small individual demands. We show that this result is attained with no significant effect on allocative efficiency.

Nous considérons une prise de contrôle dans laquelle les motivations des repreneurs potentiels sont multiples et étudions I’impact du degré d’affiliation de leurs évaluations sur la stratégie optimale. Nous montrons que cet impact dépend du rapport des dotations initiales. Nous trouvons que lorsque les dotations initiales sont symétriques, la stratégie optimale des enchérisseurs est indépendante du degré d’affiliation de leurs évaluations. En revanche, lorsque les dotations initiales sont asymétriques, cet impact dépend du niveau du signal privé de l’enchérisseur. Si les acqueréurs potentiels surenchérissent en présence de dotations initiales, l’étendue de la surenchére décroît avec l’augmentation du degré d’affiliation lorsque le signal privé est inférieur un certain seuil. L’agressivité des enchérisseurs profite à la firme cible dont le revenu espéré augmente avec le degré d’affiliation des évaluations.

Allotment and subcontracting are the two procedures enabling small businesses to participate in procurement. We compare these two procedures in the context of a procurement contract awarded by a first-price sealed-bid auction. We assume that the public buyer wishes to fulfil two different goals: to minimize expected costs of the contract for the public buyer and to maximize small businesses' profit. We show that, under specific cost-technology conditions we determine, the allotment procedure not only enables extensive participation by small businesses but also can achieve the goal of minimizing expected total costs for the public buyer.

Dans cet article, nous considérons la mise en œuvre du critère de l'offre économiquement la plus avantageuse dans des marchés publics passés par voie électronique. Pour cela, nous analysons la procédure usuelle de l'enchère anglaise inversée avec bonus de qualité en considérant que les coûts de production des offreurs sont croissants avec le niveau de qualité des produits et que la fonction d'utilité des acheteurs est concave en qualité. Nous montrons que cette procédure ne concrétise pas en général le mécanisme d'enchères optimal. Nous montrons ensuite qu'un plafonnement des prix dans l'enchère anglaise permet de restaurer l'optimalité de la procédure et de mettre en œuvre une discrimination analogue à la discrimination optimale dans le cas uniforme.

In this paper, we design the optimal procurement mechanisms when bidders are privately informed on efficiency and on observable but neither verifiable nor contractible quality. We show that most of the optimal procurement institutions are mixed procedure implying both separation and pooling. Thus, the existing take-it-or-leave-it offers and procurement auction appear only as polar cases. Moreover, we show that separation and pooling may affect the allocative efficiency of the procurement in a counterintuitive way, such that a less bunching mechanism can be a more inefficient one.

Un groupe d'agents décide de mettre à sa disposition un site collectif polluant. Pour ce faire, ils font appel à une entreprise chargée de la localisation et de la construction de l'installation. Celle-ci leur propose une procédure de localisation/tarification soumise à l'approbation de tous les agents. Dans un tel contexte, l'entreprise est forcée à internaliser les dommages subis par les agents dans sa fonction de coût: ce phénomène rappelle l'achat de droit à polluer. En information incomplète, les mécanismes incitatifs optimaux indiquent l'existence d'inefficacités dues à l'attribution d'une rente informationnelle à chaque agent: la localisation échoue alors qu'elle aurait profité à tout le monde. Dans deux applications (externalités diffuses et ex-ternalités locales) du modèle général, l'enchère optimale est complètement caractérisée.

This paper compares various methods used for measuring price trends in sequential auctions and draws on index number theory. Data from wine auctions are used to show that different methods applied to the same data may lead to significantly different conclusions. Moreover the same method can even lead to opposite results depending on the way pairs are selected within the set of similar objects sold sequentially. Finally, the number of identical objects being sold also influences the price trend.

We study an auction mechanism combining the war of attrition and the all-pay auction under the assumption that buyers’ signals are affiliated. We provide a sufficient condition which guarantees the existence of a symmetric, increasing equilibrium bidding strategy, but rules out full extraction of buyers’ surplus by the seller. We develop revenue comparison between the combined mechanism, the war of attrition and the all-pay auction.

Nous analysons le problème de la formation d’une entente entre soumissionnaires à un appel d’offres au premier prix confrontés au risque d’être détecté. Considérant qu’une entente peut être détectée dès qu’un offreur est dénoncé, notre objectif est de déterminer l’influence de ce risque sur la taille d’équilibre de l’entente. Deux critères de rationalité individuelle sont retenus. Premièrement, nous considérons qu’un offreur accepte d’entrer dans l’entente si et seulement son profit espéré est supérieur à celui qu’il aurait en restant en dehors. Lorsque le risque de dénonciation est trop important, nous montrons qu’aucune coalition ne peut se former. Considérant ensuite qu’un offreur accepte de participer à l’entente dès qu’il obtient un profit espéré supérieur à celui qu’il aurait en l’absence de toute coalition, nous montrons qu’une entente ne peut se former que si elle comprend un minimum d’offreurs lorsque le risque de dénonciation est élevé.