Economists puzzled by irrational eBay buyers

By Chris Gaylord, Christian Science Monitor

In the 12 years since eBay's launch, the online auction house has established itself as a one-stop shop for all things rare, kitschy, and collectible. But recently, a small group of economists have mined the site for a different prize: clues on how people spend their money.

Behind the millions of online auctions lies a virtual mini-economy flush with raw data. Harvesting this information has fed a new branch of economics, one that has proved again and again that shoppers act in unexpected ways.

Auctions can be hard to predict. Various items, be they ancient coins or next-generation electronics, can inspire odd behavior in buyers.

Late last year, crowds waited for days outside retail stores to buy the new Play­Station 3 video-game system. Many of those in line then sold the $600 machines on eBay for thousands of dollars.

But when Apple's iPhone drew similar crowds last month, resale prices on eBay were rather flat.

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