Strategic sellers learn to maximize profits in sequential auctions.
The article explores how a seller can strategically auction off similar items one after the other, based on what they learn from the first auction. They find that by committing to certain auction strategies, the seller can influence how bidders behave and maximize their profits. Specifically, they show that by setting certain conditions and prices, the seller can create a bidding equilibrium where bidders adjust their bids based on the likelihood of a second auction. This helps the seller learn more about the demand for their items and make better decisions about when to hold future auctions.