Revisiting Cash Endowment and House Money Effects in an Experimental Auction of a Novel Agri‐food Product in the Philippines. Issue 2 (June 2014)

• Record Type: Journal Article
• Authors: Depositario, Dinah Pura T.; Nayga, Rodolfo M.; Zhang, Yu Yvette; Mariano, Robert Dominick E.
• Is Part Of: Asian economic journal. Volume 28:Issue 2(2014:Jun.)
• Page Start: 201
• Page End: 215
• Publication Date: 2014-06
• Subjects: Asia -- Economic conditions -- 1945- -- Periodicals; 330.95
• DOI: 10.1111/asej.12033
• Languages: English
• ISSNs: 1351-3958

Abstract

<abstract abstract-type="main"> <title> <x xml:space="preserve">Abstract</x> </title> <p>This study explores the effect of varying cash endowments on bidding behavior in auction experiments conducted in a developing country. Our results suggest that cash endowment levels can have different effects on bidding behavior under second price auction and random <italic>n</italic>th price auction. In contrast to past studies conducted in developed countries, we generally do not see the presence of positive house money effect in our results. If behavior varies significantly as the cash endowment is varied, then care must be taken when designing auction experiments or when comparing results to other experimental results and theoretical predictions.</p> </abstract>