Elicited bid functions in (a)symmetric first-price auctions

Table 2 - Piecewise linear bid functions predicted by the risk neutral Nash equilibrium (RNNE)

Table 3 - Piecewise linear bid functions predicted by the risk averse Nash equilibrium (RANE) with a constant
relative risk aversion parameter of r = .5

2.2. Procedures

The experiment was conducted at the Laboratory for Experimental Economics of the
University of Bonn. Most subjects were students in law or economics and were recruited by
public advertisement on campus. They were required not to have participated in an auction
experiment before. We considered the three treatments described above: one for low-balling
(LOW), one for a mixture of low-balling and the “Getty effect” (MIX) and one for the
symmetric framework (SYM). We conducted a total of 8 experimental sessions: 6 with the
asymmetric treatments and 2 with the symmetric treatment. In each session, the cohort of 18
subjects was divided into 3 groups of 6 subjects. These groups were independent in the sense
that subjects interacted only with the other members of their group. Each session lasted for
about 3 hours. Average earnings in the experiment were DM 60 (which at that the time of the
experiment were approximately equal to US$28).

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