TY  - JOUR
AU  - Ashenfelter,Orley
AU  - Genesove,David
TI  - Testing for Price Anomalies in Real Estate Auctions
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 4036
PY  - 1992
Y2  - March 1992
UR  - http://www.nber.org/papers/w4036
L1  - http://www.nber.org/papers/w4036.pdf
N1  - Author contact info:
Orley C. Ashenfelter
Industrial Relations Section
Firestone Library
Princeton University
Princeton, NJ  08544
Tel: 609/258-4040
Fax: 609/258-2907
E-Mail: c6789@princeton.edu

David Genesove
Department of Economics
Faculty of Social Sciences
Hebrew University of Jerusalem
Mount Scopus, Jerusalem 91905  ISRAEL
Tel: 972-2-5883128
Fax: 972-2-5816071
E-Mail: genesove@mscc.huji.ac.il
AB  - This paper reports on the results of an auction sale of 83 condominium apartment units in New Jersey. At the auction every unit was hammered down, but, unknown to the 2,348 registered bidders, 40% of the sales fell through. Prices in the subsequent sale of condominium units in face to face negotiations resulted in identical units selling for 13% less than they fetched at auction and the discount was largest for those units hammered down early in the auction. These results are inconsistent with the usual predictions from the theory of common value auctions and suggest that uninformed bidders in this auction may have been the subject of a "winner's curse" which generated considerable profit for the seller.
ER  -