Brennan Platt

Department of Economics
Brigham Young University
130 Faculty Office Building
Provo, UT 84602-2363

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NBER Working Papers and Publications

February 2016A Theory of Bidding Dynamics and Deadlines in Online Retail
with Dominic Coey, Bradley Larsen: w22038
We present an equilibrium search model that parsimoniously rationalizes the use of auctions as a sales mechanism for new-in-box goods--a frequent occurrence in online retail markets--and analyze whether the existence of these auctions is welfare enhancing relative to a market consisting only of posted prices. Buyers have a deadline by which the good must be purchased, and sellers choose between auctions and posted-price mechanisms. As the deadline approaches, buyers increase their bids and are more likely to buy through posted-price listings. The model predicts equilibrium price dispersion even for new, homogeneous goods. Using data on one million auction and posted-price listings for new-in-box items on, we find robust evidence consistent with our model. As predicted, bidders inc...
October 2011Sticking with What (Barely) Worked
with Lars Lefgren, Joseph Price: w17477
Outcome bias occurs when an evaluator considers ex-post outcomes when judging whether a choice was correct, ex-ante. We formalize this cognitive bias in a simple model of distorted Bayesian updating. We then examine strategy changes made by professional football coaches. We find they are more likely to revise their strategy after a loss than a win -- even for narrow losses, which are uninformative about future success. This increased revision following a loss occurs even when a loss was expected, and the offensive strategy is revised even when failure is attributable to the defense. These results are consistent with our model's predictions.
January 2010Pay-to-Bid Auctions
with Joseph Price, Henry Tappen: w15695
We analyze a new auction format in which bidders pay a fee each time they increase the auction price. Bidding fees are the primary source of revenue for the seller, but produce the same expected revenue as standard auctions. Our model predicts a particular distribution of ending prices, which we test against observed auction data. Our model fits the data well for over three-fourths of routinely auctioned items. The notable exceptions are video game paraphernalia, which show more aggressive bidding and higher expected revenue. By incorporating mild risk-loving preferences in the model, we explain nearly all of the auctions.

Published: The Role of Risk Preferences in Pay-to-Bid Auctions Autores: Brennan C. Platt, Joseph Price, Henry Tappen Localización: Management science: journal of the Institute for operations research and the management sciences, ISSN 0025-1909, Vol. 59, Nº. 9, 2013, págs. 2117-2134

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