Abstract
This paper studies one managerial decision problem of the auction sites: how to combine penalties with commissions? It is shown that when there exists secondary auction market, the auction whose penalty is a linear function of the seller’s commission will be more efficient than the auction with only commissions but no penalties. It has also been proven that using this strategy can maximize the expected revenue for the seller, the auction site and their total expected revenues.
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The research was supported by NNSF of China and RGC of Hong Kong Joint Research Scheme (Project No. N_CityU103/02), and also supported by National Natural Science Foundation of China (Project No. 70401004).
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Lai, K.K., Ma, J. & Wang, S. On Managerial Decision Problem of the Auction Sites. Jrl Syst Sci & Complex 19, 340–351 (2006). https://doi.org/10.1007/s11424-006-0340-9
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DOI: https://doi.org/10.1007/s11424-006-0340-9