How do u place automatic bids on ebay?

Why doesn't eBay do sealed bid second price auctions?

• eBay is basically a second price auction but the bids are open, which defeats the theoretical advantages of second price auctions. (You can probe others' bids by bidding high and retracting, AND you can see the current second price even if you don't do this.) As we often see, people sneakily place bids in the last second to get better deals before others can bid again, rather than just making one single bid with their maximum valuation.

• Answer:

  Proxy bidding, a very popular feature on eBay, essentially creates the same outcome as sealed bid second price auctions.  eBay does not force anyone to enter their proxy bid, but they do encourage it. In proxy bidding, a buyer puts in the "maximum" bid he or she is willing to make.  At the end of the auction, eBay's system takes the maximum bid from the second-place bidder and improves that by the minimum bid amount and awards it to the first bidder (who placed a higher proxy). Thus, the first bidder gets the item for a minimal bid increment OVER the second bidder's maximum. You, therefore, have essentially what you described as a sealed-bid second price auction. As for the retracting of bids, that is an unethical practice.