Originally Posted by Dave Mayer

Exactly. Say that the auction starts $1, and you decided to bid (well in advance) $100. Another bidder could bid in even $1 increments until the $100 mark is reached. At $90, the bidding algorithm would require your competitor to bid $91, and so on. But on hitting $100, the bidding algorithm would reveal your high bid at $100, and that you are still the high bidder, since yours was first.

Now let's say that Bidder 2 was a shill. Say Cletis, the toothless cousin of the seller. I know, this is illegal, but so is speeding. I would say that Cletis just earned his cousin an extra $99.