Instructions for Paper Analyzing Ebay Auctions
You are to write a paper based on your analysis of auctions on Ebay.com. First, I prefer that
you work in groups of three for this paper, although groups of two people are permissible. The
Econ 4350 students will turn in a 5-7 page paper on the last day of class. The Econ 6350 students
will give a powerpoint presentation instead. All students should do the following:
1. Find one object that is repeatedly auctioned oﬀ both singly (an English auction) and in
multiples (what Ebay calls a Dutch auction). This eliminates unique works of art such as
original paintings and sculptures, but not widely-sold copies of them. Other good choices
might be a speciﬁc type of Beanie Baby, a speciﬁc computer processor, or a speciﬁc memory
stick for a Palm Pilot. Mike Massey has suggested the following:
a) Do not go for the large items like an X-box or a Palm Pilot. They cost too much and
most sellers on Ebay don’t have enough capital to keep large enough amounts to have a
b) Think about components of some larger system. For example, instead of a computer, try
a hard drive or memory chip. Or try a certain type of mouse or keyboard.
c) If all else fails, try doing a search in a particular auction category for “dutch” auctions
X-Box Memory Cards
San Disk Multimedia Card
Genuine Leather Palm Case
Microsoft Sidewinder Gamepad
Samsung Car Charger
SONY 64MB Memory Sticks
If you need additional help, you can contact mike at firstname.lastname@example.org
2. For your object, you should accumulate data on at least 20 and at most 50 total auctions of
both types for exactly the same product over a period of several weeks. Try to collect about
half of you obsevations for each auction type. For example, if you collect 50 observations, try
to ﬁnd 25 Dutch and 25 English auctions for your chosen good. This is not always possible,
so do the best you can. Just convince me that you really did try to ﬁnd a balanced number.
With each auction you need to record the following data onto an Excel spreadsheet:
a. Auction type (enter English as a 1 and Dutch as a 0)
b. Date that auction begins( like 1/21/01)
c. Number of bidders
d. Length of time the auction lasted in days
e. Diﬀerence between ﬁrst bid price and awarded price.
f. Diﬀerence between the highest bid and the lowest successful bid in the case of a Dutch
auction. Enter 0 if this is an English auction.
g. Final sales price. If the auction is Dutch, record the price at which all items sell. If the
auction is English, record the single sales price.
h. Number of items sold. For the English auction, this will be one and for the Dutch auction,
this will be greater than one.
a. Analysis–for Econ 4350 students I want you to ﬁrst summarize the theory about auctions
as presented in class. Indicate the extent to which this theory would lead you to predict
diﬀerences between the English and the Ebay Dutch auction prices for the same item.
Then compute the average price under each auction type and try to explain why there is a
diﬀerence in average price. That is, what part of the diﬀerence in prices between the two
auction types can be attributed to diﬀerences in the other factors b.)–h.) on which you
have collected data. You are not expected to perform a regression analysis. Your paper
should include a copy of the Excel spreadsheet.
b. Analysis–for 6350 students I want you do the same analysis, but I would expect that it
would be more sophistocated. Hopefully, you might do some kind of regression analysis,
where you regress the ﬁnal auction price on the variables a.)-h.). If you need some help
on this you can see me or my T.A. A 10 minute presentation at the end of the semester
using Powerpoint slides will substitute for a paper. You should hand in a xerox copy of
your Powerpoint slides and include a copy of the Excel spreadsheet.