Abstract：[Objective] The land market plays a key role in achieving a stable and healthy market for real estate development and has a significant impact on macroeconomic conditions, government finances, and overall financial stability. However, many participants in the Chinese land market engage in blind expansion and irrational land acquisition, which interferes with achieving policy objectives such as price stability for land and housing, as well as the healthy development of the land market. This study analyzes market feedback of land auction participants and the factors influencing them. We use auction theory to examine the existence of the winner's curse phenomenon in the Beijing land market and provide policy recommendations for the government to regulate the land market. [Methods] This study is based on micro-level auction data from land sales in Beijing between 2013 and 2018 and from the Wind enterprise database. We first construct models to calculate cumulative abnormal returns for the auction participants' stock prices in the periods following land auctions. We then use an event study to explore the effects of participant, land, and auction characteristics on stock price changes. Particular attention is given to market feedback on the auction winners. The uniqueness of this study lies in the vast amount of data used. We consider factors that are crucial elements of market feedback but have been relatively unexplored in previous studies, such as participants' bidding premiums, past experiences in land auctions, and joint bidding. [Results] We find that:(1) The higher the final bidding premium of land auction participants, the more negative the market's reaction. Previous experience with repeated bidding and joint bidding enables participants to access more market information, helping mitigate irrational bidding. Variables such as land value, bidding intensity, and the frequency of winning bids on a single day that reflect a bidder's economic strength lead to more positive market evaluations. (2) Evidence of the winner's curse phenomenon is observed in the Beijing land market. Although cumulative abnormal returns do not show significant inter-group differences between winners and losers, results of controlling for the final bidding premium reveal that higher bidding premiums result in more negative market evaluations for the winners. Joint bidding helps winners to make rational bids, but the effect of repeated participation in the short term is not significant. (3) The market holds a significantly negative view of bidders who are active over an extended period, and this effect is more pronounced for the winners, providing additional evidence for the existence of the winner's curse phenomenon. [Conclusions] Based on these findings, we recommend the government to enact policies to encourage market participants to make rational bids. This could be achieved by promoting complementary advantages and sharing market information through joint bidding to some extent. The government should also enhance information disclosure through various means to alleviate information asymmetry in the market and strengthen supervision of active market participants' funds and the development and construction processes to reduce irrational bidding behavior.
李恩源, 刘洪玉, 朱恩伟. 北京土地市场的赢者诅咒现象[J]. 清华大学学报（自然科学版）, 2024, 64(2): 173-180.
LI Enyuan, LIU Hongyu, ZHU Enwei. Phenomenon of the winner's curse in the Beijing land market. Journal of Tsinghua University(Science and Technology), 2024, 64(2): 173-180.
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2024, Vol. 64 
