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2-* Auctions as EC Market Mechanisms auction A competitive process in which a seller solicits consecutive bids from buyers (forward auctions) or a buyer solicits bids from sellers (backward auctions). Prices are determined dynamically by the bids 2-* Auctions as EC Market Mechanisms Traditional Auctions versus E-Auctions Limitations of traditional offline auctions rapid process gives potential buyers little time to make a decision electronic auction (e-auction) Auctions conducted online dynamic pricing Prices that change based on supply and demand relationships at any given time 2-* Auctions as EC Market Mechanisms Types of Auctions One buyer, one seller One seller, many potential buyers forward auction An auction in which a seller entertains bids from buyers. Bidders increase price sequentially 2-* Auctions as EC Market Mechanisms One buyer, many potential sellers reverse auction (bidding or tendering system) Auction in which the buyer places an item for bid (tender) on a request for quote (RFQ) system, potential suppliers bid on the job, with the price reducing sequentially, and the lowest bid wins; primarily a B2B or G2B mechanism “name-your-own-price” model Auction model in which a would-be buyer specifies the price (and other terms) he or she is willing to pay to any willing and able seller. It is a C2B model that was pioneered by P 2-* Auctions as EC Market Mechanisms 2-* Auctions as EC Market Mechanisms Many sellers, many buyers double auction Auctions in which multiple buyers and their bidding prices are matched with multiple sellers and their asking prices, considering the quantities on both sides 2-* Auctions as EC Market Mechanisms Benefits of E-Auctions Benefits to Sellers Benefits to Buyers Benefits to E-Auctioneers Limitations of E-Auctions Minimal security Possibility of fraud Limited participation 2-* Auctions as EC Market Mechanisms Impacts of Auctions Auctions as a coordination mechanism Auctions as a social mechanism to determine
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