I
N TIIIS ~tudy, attention focuses on the
behaVIor of a class of auction mar-
kets where formal organization re-
quires the individual competing bidders
to submit one or more written "sealed
bids" specifying the quantity and price
at which they are committed to buy (or
sell) units of the item being traded.
In many such markets only a single
unit, such as a contract for the construc-
tion of a bridge or building, is involved.
The experimental designs and theory
underlying this study assume that many
units of the item are to be offered for
sale (or are required to be purchased).
Perhaps the most important continuing
market having this structure is the auc-
tion market for new Treasury bills with
maturities of 91 and 182 days. Other
examples might be the letting of con-
tracts for transportation service, where
the service requirements are in excess
of the capacity of any single firm or the
letting of material contracts, ~y for
cement, where the requirements exceed
the capacity of any one producer.
Our primary purpose is to study indi-
vidual bidding behavior and price de-
termination under two alternative forms
of market organization: (1) price dis-
crimination, under which successful