AH Blues

[TanksAndSpartans]

This is actually an interesting academic question. Economics 101 would certainly tell you its completely irrational to behave differently because in one case the amount you pay is what you bid (plus shipping) and in the other case the amount you pay is what you bid + 20% + shipping. The rational thing to do is make the calculation of adding the BP and behave (bid) the same way in both cases (i.e. reduce your bid because you know you will be hit with a BP at checkout). Someone would need to do a study to see if people actually behave according to the theory or whether the fact that that 20% in not included in their bid induces them to pay more as if they are willing to momentarily forget they will be charged the 20% later. It's entirely possible, and also the reason I believe some auction houses want you to have to do the math in your head (or not do it), rather than show you the BP when you place your bid. I think its something called the framing effect where people view options that are really the same as different depending on how they are stated.

One minor point is because the bid increments are wider for AHs than eBay, sometimes I have to make a decision whether I want to go under or over my target - something I never really have to do on eBay where the bid increments are very narrow.

[TanksAndSpartans]

With regard to what I said below, I'd be surprised if anyone found empirical evidence that people wind up paying more (all else being held constant i.e. same item etc.) when the auction format includes a BP. That being said, I'm sure it happens - people can get carried away in the moment and as this thread stayed alive it did get me to thinking about another point:

I think the BP is kind of "phony". It seems more genuine to me that the AH should just get a percentage of the final bid. I don't care how simple the math is, why make people do it? I've been in the situation before placing a bid and the BP wasn't shown on the bidding screen, so I had to go search what it was elsewhere on the website before making the bid. It was kind of annoying. And why? Just so the AH can "frame" their model as not charging the seller? There is evidence out there framing i.e. describing 2 equivalent options in different ways can result in people choosing differently. I guess if one AH dropped the BP, other AHs could use it for marketing and say "we don't charge the seller, consign with us." It would be nonsense, but it would probably happen.

It's never been a consideration for me buying or selling, but I would see it as an improvement if the BP went away.

Originally Posted by TanksAndSpartans

This is actually an interesting academic question. Economics 101 would certainly tell you its completely irrational to behave differently because in one case the amount you pay is what you bid (plus shipping) and in the other case the amount you pay is what you bid + 20% + shipping. The rational thing to do is make the calculation of adding the BP and behave (bid) the same way in both cases (i.e. reduce your bid because you know you will be hit with a BP at checkout). Someone would need to do a study to see if people actually behave according to the theory or whether the fact that that 20% in not included in their bid induces them to pay more as if they are willing to momentarily forget they will be charged the 20% later. It's entirely possible, and also the reason I believe some auction houses want you to have to do the math in your head (or not do it), rather than show you the BP when you place your bid. I think its something called the framing effect where people view options that are really the same as different depending on how they are stated.

One minor point is because the bid increments are wider for AHs than eBay, sometimes I have to make a decision whether I want to go under or over my target - something I never really have to do on eBay where the bid increments are very narrow.