Jump to ContentJump to Main Navigation
Show Summary Details
More options …

Review of Marketing Science

CiteScore 2018: 0.12

SCImago Journal Rank (SJR) 2018: 0.114
Source Normalized Impact per Paper (SNIP) 2018: 0.070

See all formats and pricing
More options …

Designing Experimental Auctions for Marketing Research: The Effect of Values, Distributions, and Mechanisms on Incentives for Truthful Bidding

Jayson L Lusk / Corinne Alexander / Matthew C. Rousu
Published Online: 2007-10-19 | DOI: https://doi.org/10.2202/1546-5616.1059

Accurately estimating consumer preferences for new products is an arduous task made difficult by the fact that individuals tend to exhibit a number of biases when answering hypothetical survey questions. Experimental auctions have advantages over conventional methods of estimating consumer preferences because they provide incentives for consumers to truthfully reveal their preferences. However, there is currently little information available to determine which mechanism to select among the class of incentive compatible mechanisms. In this paper, we provide insight into the theoretical properties of several incentive compatible value elicitation mechanisms including the Becker, DeGroot, Marschak (BDM) mechanism, Vickrey nth price auctions, and the random nth price auction. In particular, we draw attention to the shapes of the payoff functions and illustrate that the mechanisms differ with respect to the expected cost of deviating from truthful bidding. We show that incentives for truthful bidding depend on the distribution of competing bidders' values and/or prices and individuals' true values for a good. Our approach can be viewed as a diagnostic tool to aid in selecting between preference elicitation mechanisms.

Keywords: auction; payoff function; preference elicitation; willingness-to-pay

About the article

Published Online: 2007-10-19

Citation Information: Review of Marketing Science, Volume 5, Issue 1, ISSN (Online) 1546-5616, DOI: https://doi.org/10.2202/1546-5616.1059.

Export Citation

©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston.Get Permission

Citing Articles

Here you can find all Crossref-listed publications in which this article is cited. If you would like to receive automatic email messages as soon as this article is cited in other publications, simply activate the “Citation Alert” on the top of this page.

P. Combris, P. Bazoche, E. Giraud-Héraud, and S. Issanchou
Food Quality and Preference, 2009, Volume 20, Number 8, Page 550
Arnaud Z. Dragicevic and David Ettinger
Journal of Benefit-Cost Analysis, 2011, Volume 2, Number 2, Page 1
Francesco Caracciolo, Riccardo Vecchio, Marco Lerro, Giuseppina Migliore, Giorgio Schifani, and Luigi Cembalo
Food Research International, 2019, Volume 122, Page 87
Riccardo Vecchio, Carla Cavallo, Gianni Cicia, and Teresa Del Giudice
Nutrients, 2019, Volume 11, Number 2, Page 323
Riccardo Vecchio and Massimiliano Borrello
Food Research International, 2018
Riccardo Vecchio, Maria T Lisanti, Francesco Caracciolo, Luigi Cembalo, Angelita Gambuti, Luigi Moio, Tiziana Siani, Giuseppe Marotta, Concetta Nazzaro, and Paola Piombino
Journal of the Science of Food and Agriculture, 2018
Marco Lerro, Francesco Caracciolo, Riccardo Vecchio, and Luigi Cembalo
Journal of Consumer Affairs, 2018
Mario Amato, Petjon Ballco, Belinda López-Galán, Tiziana De Magistris, and Fabio Verneau
Wine Economics and Policy, 2017
A. Banerji, Shyamal Chowdhury, Hugo De Groote, J. V. Meenakshi, Joyce Haleegoah, and Manfred Ewool
Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, 2017
Bram Kuijken, Gerda Gemser, and Nachoem M. Wijnberg
Journal of Product Innovation Management, 2017
Matthew Alan Freeman, Kalyn Coatney, Mark Schilling, Peter Allen, and Michael Ciaramella
Aquaculture Economics & Management, 2016, Page 1
Shaosheng Jin, Yan Zhang, and Yining Xu
Food Control, 2017, Volume 77, Page 163
Riccardo Vecchio, Alessia Lombardi, Luigi Cembalo, Francesco Caracciolo, Gianni Cicia, Felicia Masucci, and Antonio Di Francia
British Food Journal, 2016, Volume 118, Number 10, Page 2404
Joseph Birundu Mogendi, Hans De Steur, Anselimo Makokha, and Xavier Gellynck
British Food Journal, 2016, Volume 118, Number 9, Page 2200
Riccardo Vecchio, Ellen J. Van Loo, and Azzurra Annunziata
International Journal of Consumer Studies, 2016, Volume 40, Number 3, Page 368
Helen Arce Salazar and Leon Oerlemans
Journal of Consumer Affairs, 2016, Volume 50, Number 2, Page 286
Ji Yong Lee, Doo Bong Han, Rodolfo M. Nayga Jr, and Jong Min Yoon
China Agricultural Economic Review, 2014, Volume 6, Number 1, Page 125
Riccardo Vecchio and Eugenio Pomarici
Applied Economics Letters, 2013, Volume 20, Number 14, Page 1298

Comments (0)

Please log in or register to comment.
Log in