The Winner's Curse

"The Winner's Curse – Why winning the deal often means losing your money" explores a paradox of Game Theory. In any auction with incomplete information (like bidding for an oil field or a house), the winner is almost always the person who overestimated the value of the item the most. Therefore, "winning" the auction usually means you have paid more than the item is worth.



Economist David Rice explains how this curse applies to corporate mergers, sports contracts, and eBay bidding. The book argues that the thrill of victory blinds us to the math of value. It teaches the strategy of "shading"—deliberately bidding less than you think an item is worth to account for the likely error in your calculation.



"The Winner's Curse" is a guide to losing intelligently. It suggests that in many competitive scenarios, the only way to truly win is to let someone else take the prize and the subsequent loss.