PUB - Publikationen an der Universität Bielefeld

In the 19(th) century, auctions became a widespread form of transaction for real estate in England. Contemporaries viewed auctioning as an effective method for the transaction of land, in terms of price determination and transparency. Contrary to these theoretical assumptions, the article shows that in practice it was not economic efficiency but group interests that played a decisive role in the establishment of the auction mechanism. The article provides an analysis of the formal and informal rules of the auction trade for real estate and argues that 19(th) century real estate auctions did not always lead to optimal results in terms of valuation and allocation because power structures played a greater role in them than auction theory assumes.