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Wiki Education Foundation-supported course assignment
editThis article is or was the subject of a Wiki Education Foundation-supported course assignment. Further details are available on the course page. Student editor(s): Adam0115.
Above undated message substituted from Template:Dashboard.wikiedu.org assignment by PrimeBOT (talk) 13:02, 17 January 2022 (UTC)
Wiki Education Foundation-supported course assignment
editThis article is or was the subject of a Wiki Education Foundation-supported course assignment. Further details are available on the course page. Student editor(s): FarrahO.
Above undated message substituted from Template:Dashboard.wikiedu.org assignment by PrimeBOT (talk) 13:02, 17 January 2022 (UTC)
Savvy bidders?
editIs that the correct term to use? -LeinaD natipaC 12:59, 15 August 2006 (UTC)
- If there's a technical term, I don't know it. The point is that a bidder who understands bidding strategy will adjust for the winner's curse when setting their bid. "Savvy" gets the idea across, I think. Isomorphic 06:43, 23 September 2006 (UTC)
Google IPO
editIt's worth noting that in the Google IPO, the Winner's curse did not strike--instead the stock doubled within a quarter. I think the model of human behaviour is overly simplistic--which is probably just as well, or no-one would ever buy anything at auction at all! -- anon in August 2005
- there was not only one good.
- all bidders underestimated (the stock price at the next possible sale moment)
- Tobias Conradi (Talk) 16:58, 18 November 2005 (UTC)
Seen vs. Unseen
editI agree that this is a simplistic concept. But this just means that sometimes there will be realities that make the concept inapplicable. It is still useful when additional complexities don't apply to a significant degree...and applicability is always by degrees.
For example. The "Winner's curse" concept focuses on multiple bidders on a single auction item. What if, as is often the case, there is not just one item for auction, but many identical ones for auction? Instead of a winner's curse scenario, what develops are standard supply and demand market equilibria. And remember, the winner's curse is referring to an overpayment relative to market price, not labor cost. Further, every good can be measured in opportunity costs of possibly very different goods. We can therefore state that the winner's curse of auctions is applicable to the degree that multiple bidders consider the particular auction better than the perceived cost of their next best opportunity. Also, good examples of winner's curse involve goods or services intended to be used as capital, expecting a measurable return on investment (ROI), where realized return on investment would be compared to actual ROI where the effect of winner's curse could be measured. If it could apply to objects like celebrity memorabilia, it would be difficult to measure any financial loss created by overpaying for the good.
Unless I get further comments, I may eventually add a version of the above paragraph to the article. Carltonh 20:25, 24 October 2005 (UTC)
Battle of attrition?
editMaybe I'm exposing my own ignorance here, but how are winner's curse and battle of attrition related? I mean, I guess they both deal with situations that could be described according to game theory, but is there a better connection I'm not seeing? - JustinWick 21:46, 21 September 2006 (UTC)
- Ah, it was War of attrition (game), I disambiguated. - JustinWick 09:21, 7 December 2006 (UTC)
balancing effect
editIt appears to me that if the resulting prices in auctions were systematically too high, not many people would be interested in buying, but there would be a huge amount of sellers. Thinking about this in terms of demand and supply, would this not drive prices down so that the winner's curse effect is cancelled? Kokkokanta 17:04, 13 January 2007 (UTC)
To be added
editOne way to systemically avoid Winner's Curse is the Vickrey auction: it is the best system for determining the "real price" of a goods, given sufficient amount of bidders, because then the optimal strategy is to bid "honestly".
worse off and value
editRegarding this edit, the standard notion in auction theory (and lots of economics) is that the bidder has a reservation price for the thing they're bidding for, and that reservation price is based on their expectations of what the characteristics of the thing will be. Frequently, for auctions to businesses, the reservation price is the expected additional profit the item will bring to the business. If the buyer later finds out that the item is not what they expected, their recomputed reservation price for the item may be less than their original reservation price, and even less than they paid for the item. So, yes, the main crux of the winner's curse is that the winner may pay more for an item than it is worth to them. I think the current phrasing is clear, but if you disagree, it might not be clear and could perhaps be changed. CRETOG8(t/c) 16:34, 19 October 2011 (UTC)
Just wanted to know
editUser:Flyer22 Reborn Hi, a couple of days ago you reverted my edits with a diff browser called Huggle and I was just wondering why. Not in a "why would you do that" kind of way. I just wanted to know what I did wrong. FarrahO (talk) 02:58, 20 October 2018 (UTC)
- I reverted you with WP:Huggle. The only issues I can see with your edits is that you changed the spelling (see WP:ENGVAR) and that you capitalized the heading (see WP:HEAD). Feel free to restore the other content. Flyer22 Reborn (talk) 06:51, 20 October 2018 (UTC)
- Alright, thanks for letting me know. FarrahO (talk) 05:12, 22 October 2018 (UTC)
Ex Post value
edit"Savvy bidders [...] place a bid that is [...] equal to their ex post belief about the value of the item" How do they do this? Isn't the whole point that they don't know the ex post value of the item? Sleekpylon (talk) 04:10, 22 November 2023 (UTC)