Availability of Substitutes, Information Effects, and Bidding Behavior in Private Value Auction Experiments

In this paper, we examine for the effect of the availability of substitutes on valuation behaviors in a private value auction experiment, and how these effects can moderate food product information effects. We especially focus on whether consumers in a food valuation setting with multiple food substitutes bid differently compared to those in an environment with only one food substitute. Results suggest that allowing substitutes in a private value auction does not significantly decrease consumers’ values for the food product of interest, but the presence of additional substitutes in the experimental auction decreases the effect of food product information