Fairness in Recurrent Auctions With Competing Markets and Supply Fluctuations (original) (raw)

A Fair Mechanism for Recurrent Multi-unit Auctions

Lecture Notes in Computer Science, 2008

Auctions are a good tool for dealing with resource allocation in multi-agent environments. When the resources are either renewable or perishable resources, a repeated auction mechanism is needed, in what is known as recurrent auctions. However, several problems arise with this kind of auction, namely, the resource waste problem, the bidder drop problem, and the asymmetric balance of negotiation power. In this paper we present different mechanisms to deal with these issues. We have evaluated the mechanisms in a network bandwidth allocation scenario, and the results show that the proposed mechanisms achieve higher benefits for the auctioneer, while also providing a fairer behavior.

Resource allocation using sequential auctions

2000

Market-based mechanisms such as auctions are being studied as an appropriate means for resource allocation in distributed and multiagent decision problems. When agents value resources in combination rather than in isolation, one generally relies on combinatorial auctions where agents bid for resource bundles, or simultaneous auctions for all resources. We develop a different model, where agents bid for required resources sequentially.

Fairness in combinatorial auctioning systems

Game Theoretic and Decision Theoretic Agents: …, 2007

One of the Multi-Agent Systems that is widely used by various government agencies, buyers and sellers in a market economy, in such a manner so as to attain optimized resource allocation, is the Combinatorial Auctioning System (CAS). We study another important aspect of resource allocations in CAS, namely fairness. We present two important notions of fairness in CAS, extended fairness and basic fairness. We give an algorithm that works by incorporating a metric to ensure fairness in a CAS that uses the Vickrey-Clark-Groves (VCG) mechanism, and uses an algorithm of Sandholm to achieve optimality. Mathematical formulations are given to represent measures of extended fairness and basic fairness.

Auctions with Dynamic Populations: Efficiency and Revenue Maximization

2009

We study indirect mechanisms in a setting where both objects and privatelyinformed buyers arrive stochastically to a market. The seller in this setting faces a sequential allocation problem, and must elicit the private information of the dynamic population of buyers in order to achieve her desired outcome-either an efficient or a revenuemaximizing allocation. We propose a simple indirect mechanism, the sequential ascending auction, which yields outcomes identical to those of an efficient dynamic Vickrey-Clarke-Groves mechanism. We construct equilibria in memoryless strategies where strategic bidders are able to reach the efficient outcome by revealing all private information in every period, inducing behavior that is symmetric across both incumbent and newly entered buyers. In contrast to settings with a static population, a sequence of second-price auctions cannot yield this outcome, as these auctions do not reveal sufficient information to symmetrize different cohorts. We also extend our results to revenue-maximization, showing that the sequential ascending auction with a reserve price is optimal.

Auctions with Dynamic Populations: Efficiency and Revenue Maximization,” Unpublished manuscript

2009

ABSTRACT: We examine an environment where goods and privately informed buyers ar-rive stochastically to a market. A seller in this setting faces a sequential allocation problem with a changing population. We characterize the set of incentive compatible allocation rules and provide a generalized revenue equivalence result. In contrast to a static setting where incentive compatibility implies that higher-valued buyers have a greater likelihood of receiving an object, in this dynamic setting, incentive compatibility implies that higher-valued buyers have a greater likelihood of receiving an object sooner. We also characterize the set of efficient allocation rules and show that a dynamic Vickrey-Clarke-Groves mechanism is efficient and dominant strategy incentive compatible. We then derive an optimal direct mechanism. We show that the revenue-maximizing direct mechanism is a pivot mechanism with a reserve price. Finally, we consider sequential ascending auctions in this setting, both wi...

Developing adaptive auction mechanisms

2005

Abstract Mechanism design has traditionally been a largely analytic process, relying on assumptions such as fully rational bidders. In practice, however, these assumptions may not hold, making bidder behavior difficult to model and complicating the design process. To address this issue, we propose a different approach to mechanism design.

Repeated Auctions with the Right of First Refusal

The B.E. Journal of Theoretical Economics, 2000

This paper characterizes a set of Nash equilibria in a first-price sealed-bid repeated auction with the right of first refusal using two bidders and asymmetric information regarding the bidders' value distributions. When contract value is constant from one auction to the next and winners' values are publicized, agents retain the value of incumbency and bids are identical to one-shot auctions. When each agents' contract values are random across auctions, agents choose to bid away the full expected value of incumbency, providing a measure of the value of information in this context.

An Investigation Report on Auction Mechanism Design

Arxiv preprint arXiv:0904.1258, 2009

Auctions are markets with strict regulations governing the information available to traders in the market and the possible actions they can take. Since well designed auctions achieve desirable economic outcomes, they have been widely used in solving real-world optimization problems, and in structuring stock or futures exchanges. Auctions also provide a very valuable testing-ground for economic theory, and they play an important role in computer-based control systems. Auction mechanism design aims to manipulate the rules of an auction in order to achieve specific goals. Economists traditionally use mathematical methods, mainly game theory, to analyze auctions and design new auction forms. However, due to the high complexity of auctions, the mathematical models are typically simplified to obtain results, and this makes it difficult to apply results derived from such models to market environments in the real world. As a result, researchers are turning to empirical approaches. This report aims to survey the theoretical and empirical approaches to designing auction mechanisms and trading strategies with more weights on empirical ones, and build the foundation for further research in the field. 1 Auctions 1.1 Auction types A market is a set of arrangements by which buyers and sellers, collectively known as traders, are in contact to exchange goods or services. Auctions, a subclass of markets with strict regulations governing the information 1

Multiperiod auctions for network resources

11th International Telecommunications Network Strategy and Planning Symposium. NETWORKS 2004,, 2004

In recent years auctions have become increasingly popular for the efficient allocation of congested network resources, such as bandwidth. In this paper we consider a network provider performing auctions on end-to-end tunnels periodically, and users requesting bandwidth for long sessions (typically lasting for more than one auction period). Second-chance auctions have been recently proposed for preventing established sessions from being shut down due to an isolated short market perturbation. We propose and investigate three different types of secondchance auction mechanisms as well as optimal user strategies for them. Finally, simulation results demonstrate the advantages of second-chance auctions compared to standard multi-period PSP auctions.

Equilibrium and negotiation in multiple resource auctions

42nd IEEE International Conference on Decision and Control (IEEE Cat. No.03CH37475), 2003

The application of economic ideas to control electronic technology is an emerging design paradigm. In network and computational settings, divisible auctions are a viable tool for regulation of services such as bandwidth and processing share. Often, the performance of an agent in the system depends simultaneously on the allocation received from several resources. In this paper, we investigate the extension of a proportionally fair divisible auction to the case where agents' utilities have complementarities across multiple resources. We show the existence and uniqueness of a Nash equilibrium under various symmetry conditions. We propose a negotiation algorithm and prove that under relaxation, the scheme is locally stable for particular agent characterizations.