im saying i think ebay is overanalyzed. i believe that if your first bid is your only bid and the max you are willing to pay, the outcome would be the same.
The outcome isn't the same for one simple reason.
Some people don't use proxy bidding. Either they don't know about it, they don't understand it, or they think they are being really clever by not using it. (They aren't clever at all.)
Instead, they keep outbidding the current price manually by small amounts until they beat all bids or decide the price is too high. This works against them in two situations.
If they bid early, then even if they reach the highest bid, they leave themselves exposed to a higher bid. And because of the way they bumped up the price bit by bit, any bid will beat them.
If they bid at the end of the auction, they have no idea how high they have to go to win. They keep placing bid after bid in a race to top the proxy bids. It might take 10 bids or more to win, and they may run out of time.
There is a technical term for people like this: "the losers." And snipers love them. They keep prices low.