John,
Yes, they use shill bidders.
I actually tipped off a guy once to a seller he was dealing with on a regular basis, in a roundabout way. One bidder (the shill) would run JUST ABOUT EVERYTHING this seller had up that week, usually about 40-45 auctions. He would only end up winning a couple items each time. However, of the items that one buyer (the mark) was bidding on, the sellers shill would run up EVERY auction at the last minute, week after week. I figured out what was happening was more than bidding wars driving up the price. I was telling a friend about it, who also bid on items from the seller. He knew the guy that got bid up to big bucks each time. Amazingly, the "mark" quit bidding, and let the shill win a BUNCH of items for a while.
The seller went from selling items worth about $40 for $180-$200 each week, to doing good to get his opening bid price. His shill bidder quit winning altogether. I think he was "paying" the shill in the items he won each time, which was usually just a couple items each listing period. The seller is still active on eBay, but he doesn't get near the record-breaking bids he used to when that certain bidder quit bidding!
Of course, that was back when you could see who was bidding. Now they block that so you aren't sure who they are. eBay has ruined a fine marketplace with all their antics over the last 7-8 years. They call it "buyer protection" policy....I call it BS. Their whole marketplace is more or less geared now to "powersellers" who are drop shipping thousands of cheap items per week, not the casual seller.
