Review of Economic Design

, Volume 12, Issue 3, pp 155–163

Optimal fees in internet auctions

Original Paper

DOI: 10.1007/s10058-008-0044-9

Cite this article as:
Matros, A. & Zapechelnyuk, A. Rev Econ Design (2008) 12: 155. doi:10.1007/s10058-008-0044-9

Abstract

An auction house runs a second-price auction with a possibility of resale through re-auctions. It collects listing and closing fees from the seller. We find the fees which maximize the revenue of the auction house. In particular, we show that the optimal listing fee is zero. Our findings are consistent with the policies of eBay, Amazon, Yahoo, and other Internet auctions.

Keywords

Internet auctionsAuctions with resaleAuction houseListing feeClosing fee

JEL Classification

D44C78D82

Copyright information

© Springer-Verlag 2008

Authors and Affiliations

  1. 1.Department of EconomicsUniversity of PittsburghPittsburghUSA
  2. 2.Kyiv School of Economics and Kyiv Economics InstituteKyivUkraine