ABSTRACT
This chapter describes the alternative form of auction which allows continuous orders but executes contracts in real time as in a call market. Since contracts are executed at a single point in time, there is one market price. This motivates the name of the proposed auction: The Uniform-Price Double Auction (UPDA). UPDA is conceptually equivalent to a clearinghouse institution reported in Friedman, although there are some implementational differences. The chapter explores that the technology of laboratory experimentation can facilitate the interplay between the evaluation and modification of proposed new exchange institutions before field implementation. It compares the behavior of UPDA with double auctions (DA) and double Dutch (DD). The parametric environment chosen to motivate subjects in DA experiments allows one to make many "independent" observations on the same basic market game. Since both prices and relative bargaining strengths are randomly fluctuating, it becomes very difficult for subjects to strategize on the basis of knowledge of the environment.
