Auctions With Type-Dependent and Negative Externalities PDF Download
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Author: Isabelle Brocas
Publisher:
ISBN:
Category :
Languages : en
Pages : 43
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Book Description
We analyze optimal auction design in the presence of negative externalities. We assume that externalities are a function of both the valuation of the agent who suffers it and the valuation of the agent who obtains the good. This introduces two different sources of countervailing incentives: the reservation utility of each bidder becomes type-dependent and the equilibrium utility is not necessarily increasing in the agent's valuation. We characterize the properties of the optimal mechanism when externalities are quot;strongly decreasingquot;, quot;weakly decreasingquot; and quot;increasingquot; in the agent's valuation. Last, we discuss its implementation with sealed-bid auctions. Interestingly, bidding strategies are not necessarily increasing in valuations, and the optimal mechanism can be implemented by setting a price ceiling instead of a reserve price.
Author: Isabelle Brocas
Publisher:
ISBN:
Category :
Languages : en
Pages : 43
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Book Description
We analyze optimal auction design in the presence of negative externalities. We assume that externalities are a function of both the valuation of the agent who suffers it and the valuation of the agent who obtains the good. This introduces two different sources of countervailing incentives: the reservation utility of each bidder becomes type-dependent and the equilibrium utility is not necessarily increasing in the agent's valuation. We characterize the properties of the optimal mechanism when externalities are quot;strongly decreasingquot;, quot;weakly decreasingquot; and quot;increasingquot; in the agent's valuation. Last, we discuss its implementation with sealed-bid auctions. Interestingly, bidding strategies are not necessarily increasing in valuations, and the optimal mechanism can be implemented by setting a price ceiling instead of a reserve price.
Author: Maryann Z. Rui
Publisher:
ISBN:
Category :
Languages : en
Pages : 86
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Book Description
Data is increasingly important for firms, regulators, and researchers to develop accurate models for decision-making. Since data sets often need to be externally acquired, a systematic way to value and trade data is necessary. Moreover, buyers of data often interact with each other downstream, such as firms competing in a market. In this setting, an allocation of data may not only benefit the buying firm, but also impose negative externalities on the firm’s competitors. The way data is allocated and sold should thus depend on the particulars of its downstream usage and the interaction between data buyers. We capture the problem of valuing and selling data sets to buyers who interact downstream within the general framework of auctions of digital, or freely replicable, goods. We study the resulting single-item and multi-item mechanism design problems in the presence of additively separable, negative allocative externalities among bidders. Two settings of bidders’ private types are considered, in which bidders either know the externalities that others exert on them or know the externalities that they exert on others. We obtain forms of the welfare-maximizing (efficient) and revenue-maximizing (optimal) auctions of single digital goods in both settings and highlight how the information structure affects the resulting mechanisms. We find that in all cases, the resulting allocation rules are deterministic single thresholding functions for each bidder. For auctions of multiple digital goods, we assume that bidders have independent, additive valuations over items and study the first setting of privately known incoming externalities. We show that the welfare-maximizing mechanism decomposes into multiple efficient single-item auctions using the Vickrey-Clarke-Groves mechanism. Under revenue-maximization, we show that selling items separately via optimal single-item auctions yields a guaranteed fraction of the optimal multi-item auction revenue. This allows us to construct approximately revenue-maximizing multi-item mechanisms using the aforementioned optimal single-item mechanisms.
Author: Gopal Das Varma
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
I analyze equilibrium bidding behavior in the open ascending-bid auction with identity-dependent externalities. With reciprocal externalities, the allocation is determined by bidders' consumption values alone. With large nonreciprocal externalities, the open auction generates higher expected revenue compared to standard sealed-bid auctions. The progress of the open auction reveals more information about the identity of the potential winner, allowing active bidders greater opportunity to avoid incurring payoff-reducing externalities. The associated option value to staying active up until a relatively high price translates into higher expected revenue. Multiple bidders may sequentially quit at the same price, and relative to sealed-bid auctions, bidders experience less ex post regret.
Author: Christos Papadimitriou
Publisher: Springer Science & Business Media
ISBN: 3540921842
Category : Computers
Languages : en
Pages : 748
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Book Description
This volume contains the papers presented at the International Workshop on Internet and Network Economics held during December 17–20, 2008, in Sha- hai, China, for its fourth edition. WINE 2008 provided a forum for researchers from di?erent disciplines to communicate with each other and exchange their researching ?ndings in this emerging ?eld. WINE 2008hadteninvitedspeakers:FanChungGraham,MatthewJackson, Lawrence Lau, Tom Luo, Eric Maskin, Paul Milgrom, Christos Papadimitriou, Herbert Scarf, Hal Varian and Yinyu Ye. There were 126 submissions. Each submission was reviewed on average by 2. 5 Programme Committee members. The Committee decided to accept 68 papers. The programme also included 10 invited talks. This ?nal program contained papers covering topics including equilibrium, information markets, sponsored auction, network economics, mechanism - sign,socialnetworks,advertisementpricing,computationalequilibrium,network games, algorithms and complexity for games. December 2008 Christos Papadimitriou Shuzhong Zhang Organization Programme Chairs Conference Chair Herbert E. Scarf (Yale University) Program Co-chair Christos Papadimitriou (UC Berkeley) Program Co-chair Shuzhong Zhang (Chinese University of Hong Kong) Local Organizing Committee Chairs Committee Chair Yifan Xu (Fudan University) Committee Co-chair Duan Li (Chinese University of Hong Kong) Committee Co-chair ShouyangWang(ChineseAcademyofSciences) Committee Co-chair Xiaoping Zhao (SSE INFONET Ltd.
Author: Philippe Jehiel
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 66
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Author: Xingming Sun
Publisher: Springer
ISBN: 3030242714
Category : Computers
Languages : en
Pages : 661
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Book Description
The 4-volume set LNCS 11632 until LNCS 11635 constitutes the refereed proceedings of the 5th International Conference on Artificial Intelligence and Security, ICAIS 2019, which was held in New York, USA, in July 2019. The conference was formerly called “International Conference on Cloud Computing and Security” with the acronym ICCCS. The total of 230 full papers presented in this 4-volume proceedings was carefully reviewed and selected from 1529 submissions. The papers were organized in topical sections as follows: Part I: cloud computing; Part II: artificial intelligence; big data; and cloud computing and security; Part III: cloud computing and security; information hiding; IoT security; multimedia forensics; and encryption and cybersecurity; Part IV: encryption and cybersecurity.
Author: Bettina Klose
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Chulyoung Kim
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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We consider a scenario where a single indivisible object is auctioned off to three bidders and among the three bidders there is one bidder whose winning imposes a positive or negative externality on the other two bidders. We theoretically and experimentally compare two standard sealed-bid auction formats, first-price and second-price auctions, under complete information. Using a refinement of undominated Nash equilibria, we analyze equilibrium bids and outcomes in the two auction formats. Our experimental results show that overbidding relative to equilibrium bids is prevalent, especially in second-price auctions, and this leads to higher revenue and lower efficiency in second- price auctions than in first-price auctions, especially under negative externalities. Our results are consistent with previous experimental findings that bidders tend to overbid more in second-price auctions than in first-price auctions, and they suggest that such a tendency is robust to the introduction of externalities.
Author: Econometric Society. World Congress
Publisher: Cambridge University Press
ISBN: 0521871522
Category : Business & Economics
Languages : en
Pages : 431
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Author: Youxin Hu
Publisher:
ISBN:
Category : Consumer behavior
Languages : en
Pages : 104
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Book Description
Abstract: Standard literature on auctions considers isolated markets with bidders that are ex ante identical and independent. My dissertation research considers the behavior of bidders and sellers when they take into account other auctions and bidders' relative roles outside of a given auction. I further extend this investigation through classroom experiments. In the first chapter, I study bidders' optimal strategies under negative externalities (i.e., the auction may incur losses (instead of zero payoffs) to the losing bidders). I construct a model of auction with three bidders. One bidder is special in the sense that if he wins, both of the other bidders will incur a loss; the other two bidders are regular in the sense that as in a traditional auction, if one of them wins, the losing bidders will receive zero payoffs. Intuitively one expects regular bidders to bid more aggressively than normal to avoid the loss. However, I find that in an ascending clock auction, in equilibrium regular bidders bid less aggressively and quit before reaching their private values. This occurs because a regular bidder may have to bid above his value in order to win against the special bidder and thus risks negative profit by bidding aggressively. Since both regular bidders avoid the externality if either wins, there is a free riding incentive. Despite free riding, in most cases the clock auction is ex post efficient However, in first-price sealed bid auctions free riding and aggressive bidding incentives are simultaneous, so ex post efficiency is less frequent. I also conducted classroom experiments which suggest that bidders more often exhibit aggressive bidding rather than free riding in an ascending clock auction; furthermore, I show that in first-price sealed bid auctions, regular bidders bid more aggressively than the special bidder, indicating aggressive bidding incentives dominate free riding incentives. In the second chapter, I construct an auction model in which both number of bidders and sellers' reserve prices are endogenously determined, and estimate the value distribution among eBay bidders. I assume each bidder has a choice of auctions with different reserve prices and other auction specific factors (seller's reputation, shipping cost, auction duration, etc.). I show that in equilibrium, 1) each bidder must be indifferent to entry in any auction, and 2) each seller's reserve price must maximize expected revenue given auction structure and bidder entry behavior, which jointly determines the equilibrium number of bidders in each auction. Few theoretical works have been done to find the positive optimal reserve price when the number of bidder is endogenous. And previous empirical work usually uses observed bids to estimate bidders' value distribution and take sellers' choice (e.g., reserve prices) as exogenous. Based on the equilibrium relationship described above, my model allows estimation of bidders' value distribution not only from observed bids, but also from the number of bidders and reserve prices. To apply this structural estimation method, I use eBay digital camera auction data to estimate bidders' value distribution from bid observations and reserve prices.
