Decision Sciences
2 years ago

Online auctions face lower success due to Winner's Curse prevalence.

IGI Global eBooks
Competition and the Winner's Curse in B2B Reverse Auctions
Indranil Ghosh, John L. Fizel, Ido Millet, Diane H. Parente

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The article discusses how the Winner's Curse, a common issue in auctions, can affect online procurement auctions in businesses. The researchers analyzed data from a multinational corporation to show that in some cases, the Winner's Curse can lead to lower auction success. They suggest that firms need to be cautious in these situations and provide ways to mitigate the negative effects. The study offers practical advice for companies conducting online procurement auctions and suggests areas for future research.