Individuals and teams in auctions

Experimental studies on bidding in auctions have so far relied on individual bidders, even though teams are often involved in real auctions. We examine the bidding behaviour of individuals and teams. Our experimental results show that teams stay longer in an (ascending sealed-bid English) auction and pay significantly higher prices than individuals. Consequently, teams make smaller profits and suffer more often from the winner's curse. The auction's efficiency is nevertheless higher with teams, since bidders with the highest valuation are more likely to win the auction when teams bid. We relate our findings to the European UMTS-spectrum auctions.