New auction method ensures fair bidding for all buyers, on or off-margin.
A new type of auction called random nth-price auction was tested to see if it can make people bid honestly for items they want. The results showed that this new auction method can indeed make bidders bid sincerely, both in theory and in real-life situations. When compared to the usual second-price auction, the random nth-price auction worked better for bidders who were not willing to pay the market price. However, the second-price auction was more effective for bidders who were willing to pay the market price.