The underpricing of initial public offerings is a well-documented fact of empirical equity market research. Theories explain this underpricing with market imperfections. We study three empirically relevant IPO mechanisms under almost perfect market conditions in the laboratory: a stylized book...

Potential bidders respond to a seller's choice of auction mechanism for a common-value or affiliated-values asset by endogenous decisions whether to incur an information-acquisition cost (and observe a private estimate), or forgo competing. Privately informed participants decide whether to incur...

The business justification for multiple principals to hire a common agent is efficiency. Our empirical study demonstrates that the creation of the common agent unilaterally depresses winning bids. Additionally, the common agent was not only observed to be the dominant bidder but also paid...

In numerous auction settings potential bidders incur costs to enter the auction. Such costs may potentially influence bidder’s behavior subsequently. In this paper we experimentally study the effect of entry costs on bidding and entry behavior, through a complete information common value...

This paper analyzes an auction mechanism that excludes overoptimistic bidders inspired by the rules of the procurement auctions adopted by several Japanese local governments. Our theoretical and experimental results suggest that the endogenous exclusion rule reduces the probability of suffering...