The Impact of the Web on Auctions: Some Empirical Evidence and Theoretical Considerations

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Abstract
Since the extensive diffusion of the World Wide Web, on-line auctions have proliferated. This paper considers the impact of the Web on auction viability, operation, and diffusion. It does so by considering the impact of the Web on the various players in an auction and classifying types of auctions. The hypothesized impacts are briefly compared with the case of an established auction firm that moved to the Web and the market domain in which it operates. This is then used to contribute to the electronic markets debate and develop some hypotheses about the way in which Web-based markets that use auction mechanisms may evolve. Trust and quality are identified as key ottributes of auctions that may result in a “move to the middle” rather than the establishment of purer market mechanisms. The growth of new cybermediaries and a possible extension of the supply chain are also noted.