Title

Empirical Design of Incentive Mechanisms in Group-Buying Auctions: Chapter 8

Publication Type

Book Chapter

Publication Date

1-2009

Abstract

Experimental methodologies offer a unique lens through which to examine the dynamics of bidding behavior and consumer perceptions of the efficacy of mechanism design in group-buying auctions. Group-buying auctions permit participating consumers to leverage their numbers to achieve discounted prices for purchase. We examine three incentive mechanisms for group-buying with the goal of understanding which provide the greatest perceived value for participants, especially how the incentive mechanisms impact the participants' planned behavior and perceived value. They include time-based incentives, quantity-based incentives, and sequence-based incentives. We also examine the role of planned order sizes versus final order sizes across the models. To obtain our results. we developed an experimental test bed that permits group-buying supply procurement buyers to participate in specially developed auctions that implement the different incentive mechanisms. The empirical methods that we demonstrate suggest the efficacy of incremental refinements in the experimental design as a means for developing deeper insights into group-buying incentive mechanism design. We conclude with a discussion of the experimental methods as a means for studying a variety of mechanism design issues in the context of a larger family of group-buying mechanisms.

Keywords

Auction markets, group-buying auctions, incentive mechanisms, price curve effects, procurement, Information technology, Economic aspects, Electronic commerce

Discipline

Computer Sciences | Management Information Systems | Sales and Merchandising

Research Areas

Information Systems and Management

Publication

Economics, Information Systems, and Electronic Commerce: Empirical Research

Volume

13

Editor

R. J. Kauffman & P. P. Tallon

First Page

181

Last Page

225

ISBN

9780765615329

Publisher

M.E. Sharpe

City or Country

Armonk, NY

Copyright Owner and License

M.E. Sharpe

Additional URL

http://worldcat.org/isbn/9780765615329