How to Avoid "the Winner's Curse"

Source: NPRBack in the 1980s, a young economist—and future Nobel winner—named Richard Thaler wrote a series of columns that challenged dominant doctrines in his field. One anomaly Thaler highlighted was what he called "The Winner's Curse." The winner's curse refers to the winners of auctions or markets where people bid competitively against each other. What Thaler discovered is that "winners" are actually often "losers"—the ones who overpay for what...