Results 1  10
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46
Computationally feasible VCG mechanisms
 In Proceedings of the Second ACM Conference on Electronic Commerce (EC’00
, 2000
"... A major achievement of mechanism design theory is a general method for the construction of truthful mechanisms called VCG. When applying this method to complex problems such as combinatorial auctions, a difficulty arises: VCG mechanisms are required to compute optimal outcomes and are therefore comp ..."
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Cited by 185 (5 self)
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A major achievement of mechanism design theory is a general method for the construction of truthful mechanisms called VCG. When applying this method to complex problems such as combinatorial auctions, a difficulty arises: VCG mechanisms are required to compute optimal outcomes and are therefore computationally infeasible. However, if the optimal outcome is replaced by the results of a suboptimal algorithm, the resulting mechanism (termed VCGbased) is no longer necessarily truthful. The first part of this paper studies this phenomenon in depth and shows that it is near universal. Specifically, we prove that essentially all reasonable approximations or heuristics for combinatorial auctions as well as a wide class of cost minimization problems yield nontruthful VCGbased mechanisms. We generalize these results for affine maximizers. The second part of this paper proposes a general method for circumventing the above problem. We introduce a modification of VCGbased mechanisms in which the agents are given a chance to improve the output of the underlying algorithm. When the agents behave truthfully, the welfare obtained by the mechanism is at least as good as the one obtained by the algorithm’s output. We provide a strong rationale for truthtelling behavior. Our method satisfies individual rationality as well.
Frugal path mechanisms
, 2002
"... We consider the problem of selecting a low cost s − t path in a graph, where the edge costs are a secret known only to the various economic agents who own them. To solve this problem, Nisan and Ronen applied the celebrated VickreyClarkeGroves (VCG) mechanism, which pays a premium to induce the edg ..."
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Cited by 108 (2 self)
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We consider the problem of selecting a low cost s − t path in a graph, where the edge costs are a secret known only to the various economic agents who own them. To solve this problem, Nisan and Ronen applied the celebrated VickreyClarkeGroves (VCG) mechanism, which pays a premium to induce the edges to reveal their costs truthfully. We observe that this premium can be unacceptably high. There are simple instances where the mechanism pays Θ(k) times the actual cost of the path, even if there is an alternate path available that costs only (1 + ɛ) times as much. This inspires the frugal path problem, which is to design a mechanism that selects a path and induces truthful cost revelation without paying such a high premium. This paper contributes negative results on the frugal path problem. On two large classes of graphs, including ones having three nodedisjoint s − t paths, we prove that no reasonable mechanism can always avoid paying a high premium to induce truthtelling. In particular, we introduce a general class of min function mechanisms, and show that all min function mechanisms can be forced to overpay just as badly as VCG. On the other hand, we prove that (on two large classes of graphs) every truthful mechanism satisfying some reasonable properties is a min function mechanism. 1
Mechanism design via differential privacy
 Proceedings of the 48th Annual Symposium on Foundations of Computer Science
, 2007
"... We study the role that privacypreserving algorithms, which prevent the leakage of specific information about participants, can play in the design of mechanisms for strategic agents, which must encourage players to honestly report information. Specifically, we show that the recent notion of differen ..."
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Cited by 105 (3 self)
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We study the role that privacypreserving algorithms, which prevent the leakage of specific information about participants, can play in the design of mechanisms for strategic agents, which must encourage players to honestly report information. Specifically, we show that the recent notion of differential privacy [15, 14], in addition to its own intrinsic virtue, can ensure that participants have limited effect on the outcome of the mechanism, and as a consequence have limited incentive to lie. More precisely, mechanisms with differential privacy are approximate dominant strategy under arbitrary player utility functions, are automatically resilient to coalitions, and easily allow repeatability. We study several special cases of the unlimited supply auction problem, providing new results for digital goods auctions, attribute auctions, and auctions with arbitrary structural constraints on the prices. As an important prelude to developing a privacypreserving auction mechanism, we introduce and study a generalization of previous privacy work that accommodates the high sensitivity of the auction setting, where a single participant may dramatically alter the optimal fixed price, and a slight change in the offered price may take the revenue from optimal to zero. 1
Competitive Auctions
, 2002
"... We study a class of singleround, sealedbid auctions for items in unlimited supply, such as digital goods. We introduce the notion of competitive auctions. A competitive auction is truthful (i.e., encourages buyers to bid their utility) and yields profit that is roughly within a constant factor of ..."
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Cited by 78 (10 self)
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We study a class of singleround, sealedbid auctions for items in unlimited supply, such as digital goods. We introduce the notion of competitive auctions. A competitive auction is truthful (i.e., encourages buyers to bid their utility) and yields profit that is roughly within a constant factor of the profit of optimal fixed pricing for all inputs. We justify the use of optimal fixed pricing as a benchmark for evaluating competitive auction profit. We show that several randomized auctions are truthful and competitive and that no truthful deterministic auction is competitive. Our results extend to bounded supply markets, for which we also get truthful and competitive auctions.
How Much Can Taxes Help Selfish Routing?
 EC'03
, 2003
"... ... in networks. We consider a model of selfish routing in which the latency experienced by network tra#c on an edge of the network is a function of the edge congestion, and network users are assumed to selfishly route tra#c on minimumlatency paths. The quality of a routing of tra#c is historically ..."
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Cited by 61 (5 self)
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... in networks. We consider a model of selfish routing in which the latency experienced by network tra#c on an edge of the network is a function of the edge congestion, and network users are assumed to selfishly route tra#c on minimumlatency paths. The quality of a routing of tra#c is historically measured by the sum of all travel times, also called the total latency. It is well known
Mechanism Design for Policy Routing
, 2006
"... The Border Gateway Protocol (BGP) for interdomain routing is designed to allow autonomous systems (ASes) to express policy preferences over alternative routes. We model these preferences as arising from an AS’s underlying utility for each route and study the problem of finding a set of routes that ..."
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Cited by 50 (7 self)
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The Border Gateway Protocol (BGP) for interdomain routing is designed to allow autonomous systems (ASes) to express policy preferences over alternative routes. We model these preferences as arising from an AS’s underlying utility for each route and study the problem of finding a set of routes that maximizes the overall welfare (i.e., the sum of all ASes’ utilities for their selected routes). We show that, if the utility functions are unrestricted, this problem is NPhard even to approximate closely. We then study a natural class of restricted utilities that we call nexthop preferences. We present a strategyproof, polynomialtime computable mechanism for welfaremaximizing routing over this restricted domain. However, we show that, in contrast to earlier work on lowestcost routing mechanism design, this mechanism appears to be incompatible with
Beyond VCG: Frugality of truthful mechanisms
 In Proceedings of the 46th Annual IEEE Symposium on Foundations of Computer Science
, 2005
"... We study truthful mechanisms for auctions in which the auctioneer is trying to hire a team of agents to perform a complex task, and paying them for their work. As common in the field of mechanism design, we assume that the agents are selfish and will act in such a way as to maximize their profit, wh ..."
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Cited by 44 (3 self)
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We study truthful mechanisms for auctions in which the auctioneer is trying to hire a team of agents to perform a complex task, and paying them for their work. As common in the field of mechanism design, we assume that the agents are selfish and will act in such a way as to maximize their profit, which in particular may include misrepresenting their true incurred cost. Our first contribution is a new and natural definition of the frugality ratio of a mechanism, measuring the amount by which a mechanism “overpays”, and extending previous definitions to all monopolyfree set systems. After reexamining several known results in light of this new definition, we proceed to study in detail shortest path auctions and “routofk sets ” auctions. We show that when individual set systems (e.g., graphs) are considered instead of worst cases over all instances, these problems exhibit a rich structure, and the performance of mechanisms may be vastly different. In particular, we show that the wellknown VCG mechanism may be far from optimal in these settings, and we propose and analyze a mechanism that is always within a constant factor of optimal. 1
Approximate Mechanism Design Without Money
, 2009
"... The literature on algorithmic mechanism design is mostly concerned with gametheoretic versions of optimization problems to which standard economic moneybased mechanisms cannot be applied efficiently. Recent years have seen the design of various truthful approximation mechanisms that rely on enforc ..."
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Cited by 43 (15 self)
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The literature on algorithmic mechanism design is mostly concerned with gametheoretic versions of optimization problems to which standard economic moneybased mechanisms cannot be applied efficiently. Recent years have seen the design of various truthful approximation mechanisms that rely on enforcing payments. In this paper, we advocate the reconsideration of highly structured optimization problems in the context of mechanism design. We explicitly argue for the first time that, in such domains, approximation can be leveraged to obtain truthfulness without resorting to payments. This stands in contrast to previous work where payments are ubiquitous, and (more often than not) approximation is a necessary evil that is required to circumvent computational complexity. We present a case study in approximate mechanism design without money. In our basic setting agents are located on the real line and the mechanism must select the location of a public facility; the cost of an agent is its distance to the facility. We establish tight upper and lower bounds for the approximation ratio given by strategyproof mechanisms without payments, with respect to both deterministic and randomized mechanisms, under two objective functions: the social cost, and the maximum cost. We then extend our results in two natural directions: a domain where two facilities must be located, and a domain where each agent controls multiple locations.
CollusionResistant Mechanisms for SingleParameter Agents
 In Proceedings of the 16th Annual ACMSIAM Symposium on Discrete Algorithms
, 2005
"... We consider the problem of designing mechanisms with the incentive property that no coalition of agents can engage in a collusive strategy that results in an increase in the combined utility of the coalition. For single parameter agents, we give a characterization that essentially restricts such mec ..."
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Cited by 41 (7 self)
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We consider the problem of designing mechanisms with the incentive property that no coalition of agents can engage in a collusive strategy that results in an increase in the combined utility of the coalition. For single parameter agents, we give a characterization that essentially restricts such mechanisms to those that post a “take it or leave it ” price to for each agent in advance. We then consider relaxing the incentive property to only hold with high probability. In this relaxed model, we are able to design approximate profit maximizing auctions and approximately efficient auctions. We also give a general framework for designing mechanisms for single parameter agents while maintaining the coalition incentive property with high probability. In addition, we give several results for a weaker incentive property from the literature known as group strategyproofness.
Optimal mechanism design and money burning
 STOC ’08
, 2008
"... Mechanism design is now a standard tool in computer science for aligning the incentives of selfinterested agents with the objectives of a system designer. There is, however, a fundamental disconnect between the traditional application domains of mechanism design (such as auctions) and those arising ..."
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Cited by 38 (12 self)
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Mechanism design is now a standard tool in computer science for aligning the incentives of selfinterested agents with the objectives of a system designer. There is, however, a fundamental disconnect between the traditional application domains of mechanism design (such as auctions) and those arising in computer science (such as networks): while monetary transfers (i.e., payments) are essential for most of the known positive results in mechanism design, they are undesirable or even technologically infeasible in many computer systems. Classical impossibility results imply that the reach of mechanisms without transfers is severely limited. Computer systems typically do have the ability to reduce service quality—routing systems can drop or delay traffic, scheduling protocols can delay the release of jobs, and computational payment schemes can require computational payments from users (e.g., in spamfighting systems). Service degradation is tantamount to requiring that users burn money, and such “payments ” can be used to influence the preferences of the agents at a cost of degrading the social surplus. We develop a framework for the design and analysis of moneyburning mechanisms to maximize the residual surplus— the total value of the chosen outcome minus the payments required. Our primary contributions are the following. • We define a general template for priorfree optimal mechanism design that explicitly connects Bayesian optimal mechanism design, the dominant paradigm in economics, with worstcase analysis. In particular, we establish a general and principled way to identify appropriate performance benchmarks in priorfree mechanism design. • For general singleparameter agent settings, we char