Essays on Core-selecting Auctions

Download or read book Essays on Core-selecting Auctions written by Marissa Renee Beck and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation provides a theoretical performance comparison of some of the leading sealed-bid combinatorial auctions and consists of three main chapters. The first chapter characterizes the complete set of pure-strategy, full-information, Nash equilibria of a set of combinatorial auctions that includes the Vickrey package auction and all core-selecting auctions. All bidder-optimal core-selecting (BOCS) auctions and the Vickrey auction have the same set of equilibrium outcomes: any assignment and individually rational payments. The equilibrium outcomes of the PAB auction must satisfy a stronger condition, but still include many inefficient assignments and payoffs outside of the true core. The second chapter looks at incentives for overbidding -- bidding more than true values -- in minimum-revenue core-selecting auctions. Previous studies ruled out overbidding by including arbitrary simplifying restrictions on the allowable bids. This chapter overturns those previous results, showing that overbidding can be a feature of all Bayesian equilibria in undominated strategies in certain incomplete-information settings. This overbidding can lead to higher expected efficiency and higher expected revenues than those with a restricted strategy space. The third chapter challenges some of the supposed advantages of BOCS auctions over the Vickrey auction with a new model of unrelated goods -- those which are neither substitutes nor complements for any bidder. The unrelated goods highlight the similarities between these auction formats, both of which can suffer from issues of low revenue and revenue non-monotonicity.