decreasing bidders' risk significantly reduces the degree of overbidding relative to the risk-neutral Bayesian-Nash equilibrium …We introduce a new method of varying the risk that bidders face in first-price private value auctions. We find that … prediction. This implies that risk affects bidding behavior as generally expected in auction theory. While resolving a long …

We present results from a series of experiments that allow us to measure overbidding and, in particular, underbidding …

We conduct an experiment to test whether probability misperception may be a possible alternative to risk aversion to … explain overbidding in independent first-price private-values auctions. The experimental outcomes indicate that subjects …-down significantly overbidding. The structural estimation of different behavioral models suggests that i) subjects are heterogenous with …

First-price auction experiments find often substantial overbidding which is typically related to risk aversion. We … introduce a model where some bidders use constrained linear bids. As with risk aversion this leads to overbidding if valuations … are high, but in contrast to risk aversion the model predicts underbidding if valuations are low. We test this model with …

We present results from a series of experiments that allow us to measure overbidding and, in particular, underbidding …

There is a debate about whether risk aversion is the main source of overbidding in a first-price independent private … probability weighting function which always induces overbidding. …