Risk Averse Buyers' Bidding Price In Online Auction

As a significant part of E-Commerce, Online Auction has brought in an innovation both in auction theory and practice.B2C and C2C are the main mode of online auction, which means that buyers are almost individuals who may be affected by their risk attitudes during bidding, so studying risk-averse buyers'bidding strategies is necessary in practice. Present researches mainly focus on the comparison of different auction mechanism in IPV model as well as the design of so called'Optimal Auction'. Meanwhile, Affiliated Value Auction Model in risk-averse condition is still a hot and complicated problem. So studying risk-averse buyers'bidding strategies is vital in theory.Based on the review of related theory, two models concerning risk aversion in auction are built, namely, the RA-SIPV model(risk averse bidder-symmetric independent private value) and the RA-SAV model(risk averse bidder-symmetric affiliated value).The structure of bidding function in risk aversion condition is compared with which in risk neutral condition. Meanwhile, some factors which effect risk-averse buyers'biding are studied, such as fixed entry fee, number of participates, commission ratio, ARA (absolute risk aversion), RRA (relative risk aversion) and affiliation.The study shows :( 1) Number of participates and the fixed entry fee have negative effect on risk-averse buyers'bidding in RA-SIPV; (2) Risk attitude does not change the structure of risk-averse buyers'bidding function in SIPV but does in SAV;(3) Commission ratio will not affect buyers'surplus;(4) ARA has a negative connection with risk-averse buyers'biding in independent private value auction, but does not exist in affiliated value auction.