Super-experienced bidders in first-price common-value auctions: Rules of thumb, Nash equilibrium bidding, and the winner's curse

Super-experienced bidders have learned to overcome the winner's curse but s till earn less than 50% of Nash equilibrium profits; Subjects deviate from the complicated Nash strategy, employing piece-wise-linear bid functions th at are capable, in principle, of generating an equilibrium with average pro fits at or above the Nash benchmark. Thus, limited computational abilities alone cannot account for the reduced earnings. Further, subjects are far fr om best responding within this family of piecewise-linear bid functions. Al ternative factors contributing to these reduced earnings are explored.