All option trades must occur on exchanges, which typically offer auctions that improve prices over existing quotes …. Wholesalers, that purchase orders from brokers, initiating auctions must be willing to trade at the existing best quote or better …. For S&P500 stocks, auctions are 23% of options volume and offer substantial price improvement of 50% of the quoted half …

If a government auctions the right to market a good, continuity is likely to be of significant importance. In a … laboratory experiment, we compare the effects of bidders' limited liability in the first-price sealed-bid auction and the English … auction in a common value setting. Our data strongly reject our theoretical prediction that the English auction leads to less …