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A Brazilian auction is a certain set of rules for a
reverse auction A reverse auction (also known as buyer-determined auction or procurement auction) is a type of auction in which the traditional roles of buyer and seller are reversed. Thus, there is one buyer and many potential sellers. In an ordinary auction al ...
. The buyer communicates the price she or he is willing to pay for the whole lot in advance. Then, the sellers bid on how many identical units they are willing to provide at that price. Like in
English auction An English auction is an open-outcry ascending dynamic auction. It proceeds as follows. * The auctioneer opens the auction by announcing a suggested opening bid, a starting price or reserve for the item on sale. * Then the auctioneer accepts incr ...
, bidding continues until a bid is made that no other bidder is willing to top. Other sources define Brazilian auction as a
reverse auction A reverse auction (also known as buyer-determined auction or procurement auction) is a type of auction in which the traditional roles of buyer and seller are reversed. Thus, there is one buyer and many potential sellers. In an ordinary auction al ...
with similarities to
Dutch auction A Dutch auction is one of several similar types of auctions for buying or selling goods. Most commonly, it means an auction in which the auctioneer begins with a high asking price in the case of selling, and lowers it until some participant accep ...
. Like in the previous definition, the overall price is constant. But instead of the increasing price as in Dutch auction, the amount of identical items is decreasing.


History

Brazilian auction as a variation of Dutch auction is introduced by Portum AG for Linde plc in the context of selling gas in Brazil.


References

{{Reflist Types of auction