Combinatorial Auction Design

Abstract

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.Auction Design, Combinatorial Bidding, Bidding with Synergies

GRASP with Hybrid Path Relinking for Bi-Objective Winner Determination in Combinatorial Transportation Auctions

“…Note that this rule might introduce an incentive for the carriers towards undesired strategicbidding behavior (a similar issue would arise with a set partitioning formulation). As this paper does not focus on auction-mechanism design (compare, e.g., Pekeč andRothkopf 2003 or Chu 2009), we leave this issue to forthcoming research.…”

Competition Between Auctions

“…Dealing with these two features 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, and by limiting biddable combinations and the use of combinatorial bids (Pekec and Rothkopf, 2003). Zeng, Cox and Dror (2007) argue that the single seller combinatorial auctions apply only to very specialized items.…”

Computer science and decision theory

“…(For recent reviews see [99,336,419].) Allowing bidders to submit "all-or-nothing" bids for combinations of goods yields NP-complete allocation problems that need to be solved efficiently in designing an auction [368].…”