The role of training in experimental auctions

Experimental auctions have become a popular tool for applied economists to elicit people's willingness to pay (WTP) for certain goods due to their demand revealing properties. The training phase is an important component of experimental auction studies since there is considerable evidence from Vickrey auctions and induced value experiments that subjects require time and practice to learn the dominant strategy in these auctions. Subjects were also informed that at the end of the choice phase and the lottery auction phase, a randomly generated number would determine which of the two phases would be selected as binding. During the training phase, subjects were shown numerical examples of exactly how their lottery payoffs would be determined. Assuming that our minimal training did not provide adequate training to subjects, or did not provide enough information about the dominant strategic properties of the auction institution, our finding further implies that extensive training could elicit more accurate WTP values from subjects.