Modeling Online Auctions

Modeling Online Auctions
Author: Wolfgang Jank
Publisher: John Wiley & Sons
Total Pages: 321
Release: 2010-12-01
Genre: Mathematics
ISBN: 1118031865
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Explore cutting-edge statistical methodologies for collecting, analyzing, and modeling online auction data Online auctions are an increasingly important marketplace, as the new mechanisms and formats underlying these auctions have enabled the capturing and recording of large amounts of bidding data that are used to make important business decisions. As a result, new statistical ideas and innovation are needed to understand bidders, sellers, and prices. Combining methodologies from the fields of statistics, data mining, information systems, and economics, Modeling Online Auctions introduces a new approach to identifying obstacles and asking new questions using online auction data. The authors draw upon their extensive experience to introduce the latest methods for extracting new knowledge from online auction data. Rather than approach the topic from the traditional game-theoretic perspective, the book treats the online auction mechanism as a data generator, outlining methods to collect, explore, model, and forecast data. Topics covered include: Data collection methods for online auctions and related issues that arise in drawing data samples from a Web site Models for bidder and bid arrivals, treating the different approaches for exploring bidder-seller networks Data exploration, such as integration of time series and cross-sectional information; curve clustering; semi-continuous data structures; and data hierarchies The use of functional regression as well as functional differential equation models, spatial models, and stochastic models for capturing relationships in auction data Specialized methods and models for forecasting auction prices and their applications in automated bidding decision rule systems Throughout the book, R and MATLAB software are used for illustrating the discussed techniques. In addition, a related Web site features many of the book's datasets and R and MATLAB code that allow readers to replicate the analyses and learn new methods to apply to their own research. Modeling Online Auctions is a valuable book for graduate-level courses on data mining and applied regression analysis. It is also a one-of-a-kind reference for researchers in the fields of statistics, information systems, business, and marketing who work with electronic data and are looking for new approaches for understanding online auctions and processes. Visit this book's companion website by clicking here

Modeling Bid Arrivals in Online Auctions

Modeling Bid Arrivals in Online Auctions
Author: Galit Shmueli
Publisher:
Total Pages: 34
Release: 2011
Genre:
ISBN:
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We introduce a new family of non-homogeneous Poisson processes (NHPP) that are useful for modeling pure and contaminated self-similar processes which describe arrivals within a finite time period. Our motivation comes from the bid arrival process in online auctions.Modeling bid arrivals in online auctions is challenging since bidding dynamics change over the course of the auction. While the start of the auction typically sees an unusual amount of early bidding which is followed by a period of little activity, the auction end typically experiences an enormous amount of last minute bidding, also known as sniping. This observed heterogeneity in bidding dynamics commands a very flexible class of models. We address these modeling challenges by proposing a class of 3-stage non-homogenous Poisson processes. We investigate the probabilistic and statistical properties of these models and illustrate their usefulness for fitting and interpreting real data from eBay.com.

Modeling Concurrency of Events in Online Auctions Via Spatio-Temporal Semiparametric Models

Modeling Concurrency of Events in Online Auctions Via Spatio-Temporal Semiparametric Models
Author: Wolfgang Jank
Publisher:
Total Pages: 0
Release: 2011
Genre:
ISBN:
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We introduce a semiparametric approach for modeling the effect of concurrent events on an outcome of interest. Concurrency manifests itself as temporal and spatial dependencies. By temporal dependency we mean the effect of an event in the past. Modeling this effect is challenging since events arrive at irregularly spaced time intervals and thus the standard definition of time-lags does not apply. Our concurrency model also takes spatial effects into account. We interpret the meaning of "space" in a slightly non-traditional way in order to conceptualize the more abstract notion of space among a set of item-features. We motivate our model in the context of eBay's online auctions. In particular, we model the effect of concurrent auctions on an auction's price. Our concurrency model consists of three components: a transaction-related component that accounts for auction-design and bidding-competition, a spatial component that takes into account similarity among item-features, and a temporal component that accounts for events in the past. To construct each of these model components, we borrow ideas from spatial modeling and from the mixed model methodology. We also develop a new time-lag metric to handle unevenly-spaced time series by interpreting a time-lag as the information distributed over a certain time-window in the past and by incorporating this information via inclusion of appropriate summary measures. We illustrate the power of this model by applying it to a large and diverse set of laptop auctions crawled off 1 eBay.com. We show that our model results in superior predictive performance compared to a set of competitor models. Our model also allows for new insight into the factors that drive price in eBay's online auctions and their relationship to bidding-competition, auction-design, product-variety and temporal learning effects.

Modeling Online Art Auction Dynamics Using Functional Data Analysis

Modeling Online Art Auction Dynamics Using Functional Data Analysis
Author: Srinivas K. Reddy
Publisher:
Total Pages: 0
Release: 2020
Genre:
ISBN:
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In this paper, we examine the price dynamics of online art auctions of Modern Indian Art using Functional Data Analysis. The purpose here is not just to understand what determines the final prices of art objects but also the price movement during the entire auction. We identify several factors such as artist characteristics (established or emerging artist; prior sales history), art characteristics (size; painting medium - canvas or paper), competition characteristics (current no. of bidders; current no. of bids) and auction design characteristics (opening bid; position of the lot in the auction) that explain the dynamics of price movement in an online art auction. We find that the effects on price vary over the duration of the auction, with some of these effects being stronger at the beginning of the auction (such as the opening bid and historical prices realized). In some cases, the rate of change in prices (velocity) increases at the end of the auction (for canvas paintings and paintings by established artists). Our analysis suggests that the opening bid is positively related to online auction price levels of art at the beginning of the auction but its effect declines towards the end of the auction. The order in which the lots appear in an art auction is negatively related to the current price level with this relationship decreasing towards the end of the auction. This implies that lots that appear earlier have higher current prices during the early part of the auction but that effect diminishes by the end of the auction. Established artists show a positive relationship with the price level at the beginning of the auction. Reputation or popularity of the artists and their investment potential as assessed by previous history of sales are positively related to the price levels at the beginning of the auction. The medium (canvas or paper) of the painting did not show any relationship with art auction price levels, but the size of the painting was negatively related to the current price during the early part of the auction. Important implications for auction design are drawn from the analysis.

Modeling Price Dynamics in eBay Auctions Using Principal Differential Analysis

Modeling Price Dynamics in eBay Auctions Using Principal Differential Analysis
Author: Wolfgang Jank
Publisher:
Total Pages: 36
Release: 2011
Genre:
ISBN:
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Empirical research of online auctions has dramatically grown in recent years. Studies using publicly available bid data from websites such as eBay.com have found many divergences of bidding behavior and auction outcomes compared to ordinary offline auctions and auction theory. Among the main differences between online and offline auctions is their longer duration (typically a few days). Along with the anonymity of bidders and sellers and the low barriers of entry, the longer online auctions tend to exhibit variable dynamics both in the bid arrivals and in the price process. In this paper we propose a family of differential equations models that captures the dynamics in online auctions. We show that a second-order differential equation well-approximates the three-phase dynamics that take place during an eBay auction. We then propose a novel multiple-comparisons test to compare dynamic models of auction sub-populations, where the population grouping is based on characteristics of the auction, the item, the seller, and the bidders. We accomplish the modeling task within the framework of principal differential analysis and functional data models.

Adaptive Bidding in Single-Sided Auctions under Uncertainty

Adaptive Bidding in Single-Sided Auctions under Uncertainty
Author: Clemens van Dinther
Publisher: Springer Science & Business Media
Total Pages: 245
Release: 2007-01-10
Genre: Computers
ISBN: 3764381132
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This is one of the first books on the use of software agents to simulate bidding behavior in electronic auctions. It introduces market theory and computational economics together, and gives an overview on the most common and up-to-date agent-based simulation methods. The book will help the reader learn more about simulations in economics in general and common agent-based methods and tools in particular.

Investigating Overbidders in Online Art Auctions Using a Bilinear Mixed Model

Investigating Overbidders in Online Art Auctions Using a Bilinear Mixed Model
Author: Mayukh Dass
Publisher:
Total Pages: 0
Release: 2007
Genre:
ISBN:
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The recent advancements in network data modeling such as bilinear mixed models have opened doors to many other social researches that were not possible to explore earlier. In this paper, we demonstrate an application of a bilinear mixed model for a complex human behavior such as overbidding in auctions, i.e. placing a bid of higher value than his or her preset valuation of the item. We use an innovative approach of illustrating auction data in the form of a network. The rich network framework allows us to consider bidder interdependence and examine overbidders (termed in the paper as Reactors) in the presence of bidders who have influenced them to do so (termed here as Influencers). Results show that Reactors bid on fewer items, but on those with high pre-auction estimated values. They also tend to bid more in the second half of the auction as compared to the first half. Implications for the auction house managers were also presented.

Auctions

Auctions
Author: Timothy P. Hubbard
Publisher: MIT Press
Total Pages: 266
Release: 2016-01-06
Genre: Business & Economics
ISBN: 0262528533
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How auctions work, in theory and practice, with clear explanations and real-world examples that range from government procurement to eBay. Although it is among the oldest of market institutions, the auction is ubiquitous in today's economy, used for everything from government procurement to selling advertising on the Internet to course assignment at MIT's Sloan School. And yet beyond the small number of economists who specialize in the subject, few people understand how auctions really work. This concise, accessible, and engaging book explains both the theory and the practice of auctions. It describes the main auction formats and pricing rules, develops a simple model to explain bidder behavior, and provides a range of real-world examples. The authors explain what constitutes an auction and how auctions can be modeled as games of asymmetric information—that is, games in which some players know something that other players do not. They characterize behavior in these strategic situations and maintain a focus on the real world by illustrating their discussions with examples that include not just auctions held by eBay and Sotheby's, but those used by Google, the U.S. Treasury, TaskRabbit, and charities. Readers will begin to understand how economists model auctions and how the rules of the auction shape bidder incentives. They will appreciate the role auctions play in our modern economy and understand why these selling mechanisms are so resilient.