Ever wondered why bidding spools out of control at an auction? Well, science has opened the mental bidding. I’m sold.
Recently, we witnessed two objects fall under the finality of the hammer in a matter so ridiculous, we might well have wished for our temples to be in place of the gavel.
While someone gleefully shelled out $591 million clams for a picture of Jingus, another decided to pay good money for a bad Donald Trump doodle (grow up), someone else decided that the jingle of loose cash in their pockets drowned out the irony, as they dropped $1.3 million on Einstein’s “Theory of Happiness,” which, in reality, was a short handwritten note which spoke of the value of modesty.
But, why listen to Albert Einstein? Cash moves everything around you. Get the money. Dolla dolla bill, y’all.
So, the obvious question is why, why do we tend to lose the plot as soon as some failed entertainer in suspenders starts mumbling numbers at machine gun rate?
Well, auctions hammer a number of our psychological buttons. They know that we love doing questionable things with an audience. Like streaking or going over the reserve to get JFK’s golf clubs. Doing this builds our physiological arousal, an effect called social facilitation. Adrenaline pumps, your heart beats faster, and your reactions quicken. Think of it as sexual congress, but with a stone-faced humorless man asking you for the Check please, Sir moments after copulation. Rationality flies out the door on the magic carpet of our excitement. In fact, rumors exist that the very rich often send delegates to auctions, which could indeed be a strategy to combat the aforesaid over-excitement.
Which, I mean, come on. If I was auction-rich, I’d go in full Monopoly-man regalia. I own four railroads, Madam, I shall open the bidding.
Adrenaline pumps, your heart beats faster, and your reactions quicken. Think of it as sexual congress, but with a stone-faced humorless man asking you for the Check please, Sir moments after copulation.
Another psychological bias in operation is the endowment effect. Within its arms, we tend to over-value things we already possess. By encouraging us to connect the bid (our money) with the sale item, bidding on items lets us fantasize about owning them. This is why the auction catalog (or the item picture and description on a website) exists. The seller wants you to imagine owning it before you do, so, ostensibly, you’re buying the thing you already own. You, dolt.
But wait, there’s more scientific tidbits. You wouldn’t want to miss out, ladies and gentlemen, this prime piece of psychological curio sits within your grasp this morning. This must be read today, and today only. The above is called the principle of scarcity, whereby we overvalue things that we think might run out. The other principle used by auctions is that of “social proof.” We all tend to take the lead from other people; if everybody does something, most of us join in before we think about what we really should do. Like Kristallnacht. Auctions drown us in a rolling sea of social proof, all swept away by the tide of thought that the item available is worthy of us.
A final, more ancient discovery was dug up by researchers from Princeton. Their experiments asked volunteers to play online auctions with different rules. Some of these auctions had rules that encouraged over-bidding (like from the television) and some had rules that encouraged rational behavior (like the eBay structure).
Strictly following the auction rules, the bidders didn’t end up paying much more than they wanted to. However, they followed logic only if they thought they were bidding against a computer, not actual people with hopes and dreams and ambitions to smash. As soon as the auction was mano-a-mano, they found it impossible to bid rationally.
So, simply put, auctions tap into the scaliest part of our lizard brains, the ancient synapse that wants to dance in the blood of our enemies while wearing the suit that Versace was shot in.