@article{61f310288e8f4ae7bf86ef59ac1e3ddb,
title = "Buyer behavior under the Best Offer mechanism: A theoretical model and empirical evidence from eBay Motors",
abstract = "We use data from eBay Best Offer listings to analyze haggling over prices in transactions with one seller and a series of potential buyers for a limited-supply product. We characterize this transaction mechanism as a sequential-move game to investigate buyer behavior. Our model suggests that a buyer's offer price increases in relations to the number of buyers who have previously made an offer on the item and the Buy-It-Now price chosen by the seller. On the other hand, the offer price decreases for items which have been listed on eBay for a longer period of time. We empirically test our theoretical predictions using data on the sales of Toyota Camry cars on eBay Motors. The empirical evidence is consistent with our model.",
keywords = "Best Offer, E-commerce, EBay, Haggling",
author = "Huang, {Ching I.} and Chen, {Jong Rong} and Lee, {Chiu Yu}",
note = "Funding Information: We would like to thank the associate editor and two anonymous referees for insightful suggestions. We have also received beneficial comments in 2010 EARIE conference, the Workshop on Econometric Theory and Application, 2011 International Industrial Organization Conference, and 2011 European Meeting of the Econometric Society. Besides, we want to thank seminar participants at National Tsing Hua University, Academia Sinica, National Taiwan University, National Taipei University, and National Central University for suggestions. Financial supports from the Center of Institution and Behavior Studies at Academia Sinica and the National Science Council in Taiwan (NSC 96-2415-H-002-016-MY2, NSC 101-2410-H-008-018) are gratefully acknowledged. All remaining errors are ours. ",
year = "2013",
month = oct,
doi = "10.1016/j.jebo.2013.07.003",
language = "???core.languages.en_GB???",
volume = "94",
pages = "11--33",
journal = "Journal of Economic Behavior and Organization",
issn = "0167-2681",
}