Combinatorial auction design

Published

Journal Article

Combinatorial auctions have two features that greatly affect their design: computational complexity of winner determination and opportunities for cooperation among competitors. Dealing with these forces trade-offs between desirable auction properties such as allocative efficiency, revenue maximization, low transaction costs, fairness, failure freeness, and scalability. Computational complexity can be dealt with algorithmically by relegating the computational burden to bidders, by maintaining fairness in the face of computational limitations, by limiting biddable combinations, and by limiting the use of combinatorial bids. Combinatorial auction designs include single-round, first-price sealed bidding, Vickrey-Clarke-Groves (VCG) mechanisms, uniform and market-clearing price auctions, and iterative combinatorial auctions. Combinatorial auction designs must deal with exposure problems, threshold problems, ways to keep the bidding moving at a reasonable pace, avoiding and resolving ties, and controlling complexity.

Full Text

Duke Authors

Cited Authors

  • Pekeč, A; Rothkopf, MH

Published Date

  • January 1, 2003

Published In

Volume / Issue

  • 49 / 11

Start / End Page

  • 1485 - 1503

International Standard Serial Number (ISSN)

  • 0025-1909

Digital Object Identifier (DOI)

  • 10.1287/mnsc.49.11.1485.20585

Citation Source

  • Scopus