Robust Bidding and Revenue in Descending Price Auctions PDF Download
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Author: Sarah Auster
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Sarah Auster
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Asunción Mochón
Publisher: Springer
ISBN: 3319088130
Category : Business & Economics
Languages : en
Pages : 161
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Book Description
In recent years, auctions have become an important field and many markets have designed new and sophisticated auction models to assign different types of items. The prime goal of this book is to set an organized classification of the main auction mechanisms in a way that readers can understand the importance of auction design and the advantages and drawbacks of each model. Given the relevance of the subject, there is a great volume of research about this topic. Nevertheless, most of these contributions use complex mathematical language difficult to understand for the average reader. In this book, the authors summarize the main ideas of the auction theory and explain them with simple language and plenty of examples. This book is a good starting point for any researcher interested in embracing the auction design as it also includes numerous real-world examples to engage the reader in the topic. “This book fills an important gap by making the main ideas and findings of auction research accessible.” Professor Paul Milgrom, Department of Economics, Stanford University.
Author: Vijay Krishna
Publisher: Academic Press
ISBN: 0080922937
Category : Business & Economics
Languages : en
Pages : 337
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Book Description
Auction Theory, Second Edition improves upon his 2002 bestseller with a new chapter on package and position auctions as well as end-of-chapter questions and chapter notes. Complete proofs and new material about collusion complement Krishna’s ability to reveal the basic facts of each theory in a style that is clear, concise, and easy to follow. With the addition of a solutions manual and other teaching aids, the 2e continues to serve as the doorway to relevant theory for most students doing empirical work on auctions. Focuses on key auction types and serves as the doorway to relevant theory for those doing empirical work on auctions New chapter on combinatorial auctions and new analyses of theory-informed applications New chapter-ending exercises and problems of varying difficulties support and reinforce key points
Author: Dirk Bergemann
Publisher:
ISBN:
Category : Auction theory
Languages : en
Pages : 59
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Book Description
We explore the impact of private information in sealed bid first price auctions. For a given symmetric and arbitrarily correlated prior distribution over values, we characterize the lowest winning bid distribution that can arise across all information structures and equilibria. The information and equilibrium attaining this minimum leave bidders uncertain whether they will win or lose and indifferent between their equilibrium bids and all higher bids. Our results provide lower bounds for bids and revenue with asymmetric distributions over values.We report further analytic and computational characterizations of revenue and bidder surplus including upper bounds on revenue. Our work has implications for the identification of value distributions from winning bid data and for the informationally robust comparison of alternative bidding mechanisms.
Author: Pak-Sing Choi
Publisher: Springer Nature
ISBN: 3030695751
Category : Business & Economics
Languages : en
Pages : 304
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Book Description
This textbook provides a short introduction to auction theory through exercises with detailed answer keys. Focusing on practical examples, this textbook offers over 80 exercises that predict bidders’ equilibrium behaviour in different auction formats, along with the seller’s strategic incentives to organize one auction format over the other. The book emphasizes game-theoretic tools, so students can apply similar tools to other auction formats. Also included are several exercises based on published articles, with the model reduced to its main elements and the question divided into several easy-to-answer parts. Little mathematical background in algebra and calculus is assumed, and most algebraic steps and simplifications are provided, making the text ideal for upper undergraduate and graduate students. The book begins with a discussion of second-price auctions, which can be studied without using calculus, and works through progressively more complicated auction scenarios: first-price auctions, all-pay auctions, third-price auctions, the Revenue Equivalence principle, common-value auctions, multi-unit auctions, and procurement auctions. Exercises in each chapter are ranked according to their difficulty, with a letter (A-C) next to the exercise title, which allows students to pace their studies accordingly. The authors also offer a list of suggested exercises for each chapter, for instructors teaching at varying levels: undergraduate, Masters, Ph.D. Providing a practical, customizable approach to auction theory, this textbook is appropriate for students of economics, finance, and business administration. This book may also be used for related classes such as game theory, market design, economics of information, contract theory, or topics in microeconomics.
Author: Peerapong Dhangwatnotai
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
In this dissertation, we design and analyze auctions that are more practical than those in the traditional auction theory in several settings. The first setting is the search advertising market, in which the multi-keyword sponsored search mechanism is the dominant platform. In this setting, a search engine sells impressions generated from various search terms to advertisers. The main challenge is the sheer diversity of the items for sale -- the number of distinct items that an advertiser wants is so large that he cannot possibly communicate all of them to the search engine. To alleviate this communication problem, the search engine introduces a bidding language called broad match. It allows an advertiser to submit a single bid for multiple items at once. Popular models such as the GSP auction do not capture this aspect of sponsored search. We propose a model, named the broad match mechanism, for the sponsored search platform with broad match keywords. The analysis of the broad match mechanism produces many insights into the performance of the sponsored search platform. First, we identify two properties of the broad match mechanism, namely expressiveness and homogeneity, that characterize the performance of the mechanism. Second, we show that, unlike the GSP auction, the broad match mechanism does not necessarily have a pure equilibrium. Third, we analyze two variants of the broad match mechanism, the pay-per-impression variant and the pay-per-click variant. Under a common model of advertiser valuation, we show that the pay-per-click variant is more economically efficient than the pay-per-impression variant. This result justifies the prevalent use of the pay-per-click scheme in search advertising. In addition, the broad match mechanism can be viewed as an auction of which the bidding language is crucial to its performance. In the second part, we design and analyze approximately revenue-maximizing auctions in single-parameter settings. Bidders have publicly observable attributes and we assume that the valuations of bidders with the same attribute are independent draws from a common distribution. Previous works in revenue-maximizing auctions assume that the auctioneer knows the distributions from which the bidder valuations are drawn \cite{M81}. In this dissertation, we assume that the distributions are a priori unknown to the auctioneer. We show that a simple auction which does not require any knowledge of the distributions can obtain revenue comparable to what could be obtained if the auctioneer had the distributional knowledge in advance. Our most general auction has expected revenue at least a constant fraction of that of the optimal distributional-dependent auction in two settings. The first setting concerns arbitrary downward-closed single-parameter environments and valuation distributions that satisfy a standard hazard rate condition, called monotone hazard rate. In this setting, the expected revenue of our auction is improved to a constant fraction of the expected optimal welfare. In the second setting, we allow a more general class of valuation distributions, called regular distributions, but require a more restrictive environment called the matroid environment. In our results, we assume that no bidder has a unique attribute value, which is obviously necessary with unknown and attribute-dependent valuation distributions. Our auction sets a reserve price for a bidder using the valuation of another bidder who has the same attribute. Conceptually, our analysis shows that even a single sample from a distribution -- another bidder's valuation -- is sufficient information to obtain near-optimal expected revenue, even in quite general settings. In the third part, we design and analyze auctions that approximately maximize residual surplus in single-parameter settings. Residual surplus is defined to be the surplus less the sum of the bidders' payments. The guarantee of our auction is of the same type as the auctions in the second part, i.e., its expected residual surplus is a fraction of that of the optimal distributional-dependent auction. Instead of the no-unique-attribute assumption made in the second setting, in this setting we assume that the distributions of bidder valuations can be ordered, that is, the distribution of the first bidder stochastically dominates that of the second bidder and the distribution of the second bidder stochastically dominates that of the third and so on. In every downward-closed stochastic-dominance environment where the distributions of bidder valuations satisfy the monotone hazard rate condition, our auction produces residual surplus that is a $\Omega(\tfrac{1}{\log n})$ fraction of the optimal residual surplus, without taking any bid (although it makes use of the ordering), where $n$ is the number of bidders.
Author: Srobonti Chattopadhyay
Publisher: Routledge
ISBN: 1351271067
Category : Business & Economics
Languages : en
Pages : 100
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Book Description
The book elaborates the basic principles of Auction Theory in a non-technical language so as to make them easily accessible to even those not trained in the discipline. Auctions as allocation mechanisms have been in use across the world since antiquity and are still employed in different countries for purchase and sales of a wide range of objects, both by governments and by private agents. Auction has gained popularity over other allocation mechanisms since the rules of auctions are very precise, involve much less subjective judgements compared to other alternative allocation mechanisms and lead to a more efficient process of discovering the true willingness of the buyers to pay. Moreover, the principles of Auction Theory are used in other contexts, for example in designing contests, or in controlling emission levels through allocation of permits and licenses.
Author: Bernhard Kasberger
Publisher:
ISBN:
Category :
Languages : en
Pages : 65
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Book Description
We show how to bid in first-price auctions when a bidder knows her own value but not how others will bid. To do this we introduce a novel and general method for how to make choices in strategic settings without assuming common knowledge or equilibrium behavior. Accordingly, first eliminate environments that are believed not to occur and then find a robust rule that performs well in the remaining environments. We test our bid recommendations using data from laboratory experiments and from the field. We find that our bids outperform those made by the real bidders.
Author: John H. Kagel
Publisher: Princeton University Press
ISBN: 0691218951
Category : Business & Economics
Languages : en
Pages : 419
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Book Description
An invaluable account of how auctions work—and how to make them work Few forms of market exchange intrigue economists as do auctions, whose theoretical and practical implications are enormous. John Kagel and Dan Levin, complementing their own distinguished research with papers written with other specialists, provide a new focus on common value auctions and the "winner's curse." In such auctions the value of each item is about the same to all bidders, but different bidders have different information about the underlying value. Virtually all auctions have a common value element; among the burgeoning modern-day examples are those organized by Internet companies such as eBay. Winners end up cursing when they realize that they won because their estimates were overly optimistic, which led them to bid too much and lose money as a result. The authors first unveil a fresh survey of experimental data on the winner's curse. Melding theory with the econometric analysis of field data, they assess the design of government auctions, such as the spectrum rights (air wave) auctions that continue to be conducted around the world. The remaining chapters gauge the impact on sellers' revenue of the type of auction used and of inside information, show how bidders learn to avoid the winner's curse, and present comparisons of sophisticated bidders with college sophomores, the usual guinea pigs used in laboratory experiments. Appendixes refine theoretical arguments and, in some cases, present entirely new data. This book is an invaluable, impeccably up-to-date resource on how auctions work--and how to make them work.
Author: Gal Cohensius
Publisher:
ISBN:
Category :
Languages : en
Pages : 31
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We study asymmetric first price auctions in which bidders place their bids sequentially, one after the other and only once. We show that with a strong bidder and a weak bidder (in terms of first order stochastic dominance of their valuations distribution function), when the asymmetry between the bidders is large enough the expected revenue in the sequential bidding first price auction (when the strong bidder bids first) is higher than in the simultaneous bidding first price auction as well as in the second price auction. The expected payoff of the weak bidder is also higher in the sequential first price auction. Therefore a seller interested in increasing revenue facing asymmetric bidders may find it beneficial to order them and let them bid sequentially instead of simultaneously. In terms of efficiency, both the simultaneous first price auction and the sequential first price auction cannot guarantee full efficiency (as opposed to a second price auction which guarantees full efficiency). The sequential bidding auction when the stronger bidder bids first achieves lower efficiency than the simultaneous auction. However, when the order is reversed and bidders are asymmetric enough the sequential first price auction achieves higher efficiency than the simultaneous one.
