Notreserve

Notreserve is a term used to describe auction arrangements in which a seller does not set a minimum sale price. In this model, the item is sold to the highest bidder, regardless of the final bid amount. The concept is commonly contrasted with reserve auctions, where a minimum price must be met.

In practice, Notreserve is used on various online marketplaces and in some real-world auction contexts to increase bidding activity and price discovery efficiency. Sellers may opt for not reserve to attract more bidders and to signal willingness to accept lower final prices; buyers may benefit from transparent competition but face the risk of ending with a price lower or higher than anticipated.

Notreserve's appeal lies in its simplicity and potential to generate higher final prices through aggressive bidding, though it can also lead to lower-than-expected revenues for sellers if demand is weak. Platforms hosting Notreserve auctions may implement safeguards such as starting bids, bid increments, auction duration, anti-sniping rules, and bidder verification to ensure fair competition.

Critics argue that not having a reserve price reduces price protection for sellers and can encourage speculative bidding or manipulation. Proponents counter that it improves price discovery and reduces bargaining frictions.

Notreserve is an example within the broader field of auction theory. It is related to both no-reserve auctions and the study of reserve prices, bidding strategies, and auction design.