Auctions under Foreign Influence By Zoë Cullen & Benjamin Harrell

Assumptions Based on research by Robert Aumann in a paper called Agreeing to Disagree, and research by Nancy Stokey and Paul Milgrom called No Trade Theorem, we made certain assumptions: Based on research by Robert Aumann in a paper called Agreeing to Disagree, and research by Nancy Stokey and Paul Milgrom called No Trade Theorem, we made certain assumptions: Regardless of what your valuation was, you would take into account your companions valuation, which would, in turn, affect your own valuation. Regardless of what your valuation was, you would take into account your companions valuation, which would, in turn, affect your own valuation. Thus, final valuations would be relatively closer to each other than first valuations. Thus, final valuations would be relatively closer to each other than first valuations.

More Assumptions We thus hypothesized that people would chose to come to an agreement before ending the information exchanges voluntarily. We thus hypothesized that people would chose to come to an agreement before ending the information exchanges voluntarily. We also expected people to be consistent in integrating their partner’s information (or how important their valuation was). We also expected people to be consistent in integrating their partner’s information (or how important their valuation was).

Results The average relative difference for each item (relative to 0) in the first valuation of rounds 1-7 was The average relative difference for each item (relative to 0) in the first valuation of rounds 1-7 was The average relative difference for for each item (relative to 0) in the last valuation of rounds 1-7 was The average relative difference for for each item (relative to 0) in the last valuation of rounds 1-7 was SEE GRAPH SEE GRAPH

Results The average relative difference for each item (relative to 0) in the first valuation of rounds 8-13 was The average relative difference for each item (relative to 0) in the first valuation of rounds 8-13 was The average relative difference for for each item (relative to 0) in the last valuation of rounds 8-13 was The average relative difference for for each item (relative to 0) in the last valuation of rounds 8-13 was SEE GRAPH SEE GRAPH

Results After 0 exchanges (1 valuations), the average relative difference was 629% After 0 exchanges (1 valuations), the average relative difference was 629% With 1 exchange (2 valuations), the average relative difference was 115% With 1 exchange (2 valuations), the average relative difference was 115% With 2 exchanges, the avg. relative difference fell to 34% With 2 exchanges, the avg. relative difference fell to 34% With 3 exchanges, the avg. relative difference fell to 28% With 3 exchanges, the avg. relative difference fell to 28% With 4 exchanges, the avg. relative difference fell to 18% With 4 exchanges, the avg. relative difference fell to 18% SEE GRAPH SEE GRAPH

Interesting Results When allowed to chose as many rounds of exchanges as desired, (the moped round), the average relative difference was.706 When allowed to chose as many rounds of exchanges as desired, (the moped round), the average relative difference was.706 When forced to do at least 3 exchanges, and then allowed to continue if desired, the average relative difference was.216 When forced to do at least 3 exchanges, and then allowed to continue if desired, the average relative difference was.216

Interesting Findings Each of you was asked to quantify your own guessing abilities as well as those of your partners. Each of you was asked to quantify your own guessing abilities as well as those of your partners. While many said that your companion’s ability to guess the correct price ranged from between 0.5 to 5, there was almost no correlation between how high you ranked your companion, and how much you took into account his/her guess. While many said that your companion’s ability to guess the correct price ranged from between 0.5 to 5, there was almost no correlation between how high you ranked your companion, and how much you took into account his/her guess. In other words, even if you thought your companion was horrible at guessing, their bid still weighed heavily on your final decision nearly all of the time. In other words, even if you thought your companion was horrible at guessing, their bid still weighed heavily on your final decision nearly all of the time.

The Winner The winner was not only the most accurate guesser, guessing closest on his first guess than anyone else on 3 occasions…. The winner was not only the most accurate guesser, guessing closest on his first guess than anyone else on 3 occasions…. He also was the only person to win an auction and not lose money in the transaction, making a $14 profit on the shopping cart. He also was the only person to win an auction and not lose money in the transaction, making a $14 profit on the shopping cart. A fantastic prize has been arranged and will be delivered to… A fantastic prize has been arranged and will be delivered to… Number… Number… Three Three

Thank You We appreciate your cooperation. ARE THERE ANY QUESTIONS?