Bidders should never overbid, but they do. A lot.
eBay auctions are structured like a second price auction combined with an ascending auction. There is an allotted time for the bidding to occur. Bidders must bid higher than the current price, so the price of the item continues to rise. The bidder with the highest bid when the time is up wins the item, and pays slightly above the second highest bid. eBay even has a feature where you can enter in your value and have an automatic bidder bid up until that value is reached, essentially eliminating the possibility of overbidding. eBay is also unique in that some auctions have a buy-now option, so the bidder can buy that item for the price at any point. Essentially, the structure of eBay is designed to favor the bidders.
Even with this features, researchers have found that 17% of people over bid their value, and 42% of people pay more than the buy now price. Why does this occur?
Auctions are designed to get people to pay a higher price by including elements of competition, scarcity, and the desire to own something the bidder does not have. Adding these elements can override the logical decision making process and cause the bidder to think that the value of the item is higher. In essence, auctions add psychological/emotional value to winning an auction. Whether or not this translates to a higher payoff is a whole other story.
http://www.bbc.com/future/story/20120907-why-we-overpay-at-auctions
https://www.nber.org/papers/w13699.pdf
https://www.thebalancesmb.com/understanding-the-ebay-auction-automatic-bidding-system-1140186