The winner's curse is more likely to occur when the value of a good at auction is uncertain.

Question

Quizplus · Accepted Answer

The winner's curse is a situation where the winning bidder in an auction ends up paying more for the item than it is actually worth. This is more likely to occur when the value of the item is uncertain or difficult to estimate, as bidders may overestimate its worth and bid higher than they otherwise would. Thus, the statement is true.

The Winner's Curse Is More Likely to Occur When the Value