Originally Posted by jimmuller

Bidding like that suggests two possibilities to me. The charitable interpretation is that the chaser really doesn't know how the automatic bidding works, specifically: Just because someone's current bid sits at $X doesn't mean that's the real high bid, so chasing it incrementally is pointless except to stop bidding just barely above the competing bidder. But stopping just above the previous high bid is futile because the competing bidder can bid over it so easily. If you are willing to pay X then bid there. If someone else is willing to bid Y where Y > X, then you live with the result or be willing to go higher in the first place. There is no psychology involved like there would be in a real-time auction. To put it another way, the "if someone else is willing to pay" reasoning is misguided but the chaser doesn't understand that yet.

The less charitable explanation is that the chaser is a shill. The seller gave it a low starting bid but really didn't want it to stay there. If it looks like it won't hit the jackpot he is hoping for the shill nudges it up. Nudging has to be incremental because the intent is to stop just below the current high bid if he can guess it accurately, or just above if he is willing to gamble that the current high bidder will push just a little more. Which is to say, the shill exercises caution because he intends to lose.

I saw something like that on an auction I won where the chaser pushed the bid up. The chaser's bidding history showed he'd incrementally chased dozens of auctions over the previous six months or so and won none of them.