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Social Bidding War
Average Score: 4 / 5
Emotional | Social
Posted on 12/04/2005 [Viewed: 3025 times]
This mindhack triggers these areas of the brain:
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In social situations, ego and saving face frequently outweigh rationality. This manifests itself in many ways, and frequently leads to escalating problems, disagreements, or emotional outbreak. In some situations, saving face and reputation can be so important that it sets a defensive tone for interactions between otherwise rational individuals. In auctions and bidding galleries, this competition is specifically manufactured and manipulated to extract higher profits for items on sale.
An interesting twist on the standard bidding auction is to require the top two bidders to pay after the auction is completed. The requirement for placing a bet is that one must agree that the top two bids pay. If a 20 dollar bill is auctioned, people will at first bid up to several dollars. In some cases, bidding will continue to 19 dollars, and onward to 20 dollars. The reason for this is because the next lowest bidder is more willing to see no one profit that to allow himself to be the second place bidder, and therefore project the impression of losing the bidding.
J. Keith Murnighan
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