The Effect of Initial Endowments in Experimental Auctions
We report the results of an experiment designed to test whether initial endowments affect value estimates elicited from experimental auctions. Comparing bids for one unit of a good, two units of a good, and a second unit of a good when endowed with the first unit, we find that willingness to pay for the second unit of a good is, on average, as much as 75% higher when endowed with the first unit. We go on to advance two theories that could potentially reconcile our results with neoclassical consumer theory. Copyright 2006 American Agricultural Economics Association.
Year of publication: |
2006
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Authors: | Corrigan, Jay R. ; Rousu, Matthew C. |
Published in: |
American Journal of Agricultural Economics. - American Agricultural Economics Association. - Vol. 88.2006, 2, p. 448-457
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Publisher: |
American Agricultural Economics Association |
Saved in:
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