Auctions

How to bid, and what sellers earn

An interactive lesson with 6 steps, about 5 minutes: you predict, drag and solve, with instant feedback on every answer. It runs in your browser and needs JavaScript.

What you’ll learn

• First-price: shade your bid (with one uniform rival, bid half your value).
• Second-price: bidding your true value is a dominant strategy.
• Winners tend to have overestimated (winner’s curse); many formats earn the same on average.

Steps

1. Sealed bids
2. Shade your bid
3. Second price
4. Honesty pays
5. The winner’s curse
6. Revenue equivalence