We investigate the relevance of conditional reasoning and belief formation for the occurrence of the winner's curse with the help of two experimental manipulations. First, we compare results from a very simple common-value auction game with results from a transformed version of this game that...

We analyze early-venture fundraising from dispersed, endogenously informed investors. An entrepreneur chooses a payoff-maximizing offering, and investors communicate their information by either contributing capital or by abstaining. The entrepreneur uses the information conveyed by fundraising...