An Exploratory Look at Early Online Auction Decisions: Extending Signal Theory

Extant literature in decision theory suggests that online auction buyers depend on signals for mitigating uncertainty that influence bidder behavior at multiple points. However, the depth and breadth of the use of signals has only been partially explored. Using data from 242 online auction users, we show that eight emergent factors influence decisions of auction selection and initial bid in different ways. We further find that two ethical perspectives impact the evaluation of seller uncertainty in unique ways, although neither perspective predominates within our sample. These results enable sellers and online auction marketplaces to better design and implement auction systems that provide signals that buyers most desire.