eBay and auction theory...?

Question

In a typical eBay auction: bidders compete for a fixed period of time, and at the end of period the highest bidder gets the good and pays his bid to the seller. During this process, any bidder can see the history of highest bids. I've these questions:

1) How important is information asymmetry in eBay auctions considering perspective of both the buyer and seller.
2) eBay has a rating system for each seller. What is the economic rationale for this (from the perspective of increasing expected revenues of the seller)?
3) In eBay auctions, should bidders be willing to bid up to their value for the good or not? Justify your answer.
4) Most bids come in right before the auction closes. What is an economic rationale for this behavior? Should this be more of a problem for common value or private value auctions?
5) Is collusion likely to be a problem here? In particular, does the auction design promote or discourage collusion?

I've some ideas but need your help to refine them.

Answer 1

A lot of people have that software that bids on the last minute, they don't have to be watching it does the bidding for them.

Answer 2

1. I don't know
2. Personnally, I avoid sellers with bad ratings, and will not sell to someone with a poor rating.
3. It's totally up to the bidder to pay up to the value of the item. I may or may not bid that much, depends on such things as shipping cost, and whether or not I can get it from another source for cheaper.
4. I usually bid at the last minute because I think that it gives me a better chance of paying less. If someone else is bidding, they may not be watching the item during the last minutes. Then I can put in a bid and win, for less money. If I were to bid on the first day, that gives more chances for more bids and the price will go higher.
5. I don't know

Answer 3

1) 50/50 - the info on the seller and the buyer are equally important.

2) as rating increases, the seller can be seen as a "trusted" vendor, therefore encouraging other people to purchase from him.

3) The price that the bidder puts is the final price that he is willing to pay. No one can tell him to up it or not.

4) answered by 1st and 2nd person.

5) ---