Absentee bidders and endogenous uncertainty in sequential auctions: evidence from wine auctions

This paper studies the presence of two types of bidders (absentee bidders vs. oral bidders) and the existence of a buyer’s option as explanations of the “price decline anomaly” in sequential auctions. Data from wine auctions are used to explore them. The main results are that the price decline observed may have three sources: the rejection of the symmetry assumption, an unbalanced division of bidder types and/or the existence of a buyer’s option. Moreover, the position of a lot in a parcel constitutes relevant information when studying price trends whereas the number of objects remaining in the parcel does not.