Quote:
Originally Posted by Aquarian Sports Cards
While I don't dispute that, the reason buyer's premium was started was competition for consignments between Sotheby's and Christie's mainly in the Art realm. Basically they used the "hey we're only charging "x" commission" line, and glossed over (if mentioning at all) this newfangled Buyer's Premium.
Buyers not paying attention, getting caught up in the heat of the moment, etc. was an unlooked-for side bonus as hard as that may be to believe.
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I don't really buy their justification; trying to gloss over the total size of the commission tells me that they were thinking carefully about how to bamboozle people and that was the driving force. Regardless of the origin of the practice, however, the 'side bonus' is the main reason it persisted and persists.
Don't get me wrong, I am not trashing the right of auctioneers to make a living, I am just searching for the underpinnings of a practice that is harder for people to understand and work with than a straightforward consignor's commission would be and I think that the various practices of auctioneers have been crafted carefully to maximize the outcomes for consignors and themselves. Like it or not, auctioning items is a classic zero-sum game: someone winning means someone else loses. In this case, every bidder who loses track of the math and bids more than he would have otherwise puts money into the pockets of the consignor and auctioneer.