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Multiunit auctions with budget limits
 In Proc. of the 49th Annual Symposium on Foundations of Computer Science (FOCS
, 2008
"... We study multiunit auctions where the bidders have a budget constraint, a situation very common in practice that has received very little attention in the auction theory literature. Our main result is an impossibility: there are no incentivecompatible auctions that always produce a Paretooptimal ..."
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Cited by 61 (7 self)
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We study multiunit auctions where the bidders have a budget constraint, a situation very common in practice that has received very little attention in the auction theory literature. Our main result is an impossibility: there are no incentivecompatible auctions that always produce a Paretooptimal allocation. We also obtain some surprising positive results for certain special cases. 1
Nonprice equilibria in markets of discrete goods
 In ACM Conference on Electronic Commerce
, 2011
"... We study markets of indivisible items in which pricebased (Walrasian) equilibria often do not exist due to the discrete nonconvex setting. Instead we consider Nash equilibria of the market viewed as a game, where players bid for items, and where the highest bidder on an item wins it and pays his b ..."
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Cited by 31 (4 self)
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We study markets of indivisible items in which pricebased (Walrasian) equilibria often do not exist due to the discrete nonconvex setting. Instead we consider Nash equilibria of the market viewed as a game, where players bid for items, and where the highest bidder on an item wins it and pays his bid. We first observe that pure Nashequilibria of this game excatly correspond to pricebased equilibiria (and thus need not exist), but that mixedNash equilibria always do exist, and we analyze their structure in several simple cases where no pricebased equilibrium exists. We also undertake an analysis of the welfare properties of these equilibria showing that while pure equilibria are always perfectly efficient (“first welfare theorem”), mixed equilibria need not be, and we provide upper and lower bounds on their amount of inefficiency.
Limitations of randomized mechanisms for combinatorial auctions
 In Proceedings of the 52nd IEEE Symposium on Foundations of Computer Science (FOCS
, 2011
"... Abstract — The design of computationally efficient and incentive compatible mechanisms that solve or approximate fundamental resource allocation problems is the main goal of algorithmic mechanism design. A central example in both theory and practice is welfaremaximization in combinatorial auctions. ..."
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Cited by 18 (4 self)
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Abstract — The design of computationally efficient and incentive compatible mechanisms that solve or approximate fundamental resource allocation problems is the main goal of algorithmic mechanism design. A central example in both theory and practice is welfaremaximization in combinatorial auctions. Recently, a randomized mechanism has been discovered for combinatorial auctions that is truthful in expectation and guarantees a (1 − 1/e)approximation to the optimal social welfare when players have coverage valuations [11]. This approximation ratio is the best possible even for nontruthful algorithms, assuming P ̸ = NP [16]. Given the recent sequence of negative results for combinatorial auctions under more restrictive notions of incentive compatibility [7], [2], [9], this development raises a natural question: Are truthfulinexpectation mechanisms compatible with polynomialtime approximation in a way that deterministic or universally truthful
Algorithmic Mechanism Design Through the lens of Multiunit auctions
, 2013
"... Mechanism Design is a subfield of game theory that aims to design games whose equilibria have desired properties such as achieving high efficiency or high revenue. Algorithmic Mechanism Design is a subfield that lies on the border of Mechanism Design and Computer Science and deals with Mechanism Des ..."
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Cited by 3 (0 self)
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Mechanism Design is a subfield of game theory that aims to design games whose equilibria have desired properties such as achieving high efficiency or high revenue. Algorithmic Mechanism Design is a subfield that lies on the border of Mechanism Design and Computer Science and deals with Mechanism Design in algorithmicallycomplex scenarios that are often found in computational settings such as the Internet. The central challenge in Algorithmic Mechanism Design is the tension between the computational constraints and the gametheoretic ones. This survey demonstrates both the tension and ways of addressing it by focusing on a single simple problem: multiunit auctions. A variety of issues will be discussed: representation, computational hardness, communication, convexity, approximations, VCG mechanisms and their generalizations, singleparameter settings vs. multiparameter settings, and the power of randomness. 1
The Design of Combinatorial Auctions for Procurement: An Empirical Study of the Chilean School Meals Auction
, 2011
"... In this paper we conduct an empirical investigation of a largescale combinatorial auction (CA); the Chilean auction for school meals in which the government procures half a billion dollars worth of meal services every year. Our empirical study is motivated by two fundamental aspects in the design o ..."
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Cited by 2 (1 self)
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In this paper we conduct an empirical investigation of a largescale combinatorial auction (CA); the Chilean auction for school meals in which the government procures half a billion dollars worth of meal services every year. Our empirical study is motivated by two fundamental aspects in the design of CAs: (1) which packages should bidders be allowed to bid on; and (2) diversifying the supplier base to promote competition. We use bidding data to uncover important aspects of the firms ’ cost structure and their strategic behavior, both of which are not directly observed by the auctioneer. Based on these estimates we analyze and suggest important improvements to the auction design. Our results indicate that package bidding should be flexible enough so that firms can express their cost synergies due to economies of scale and density. However, we also found evidence that firms can take advantage of this flexibility by discounting package bids for strategic reasons and not driven by cost synergies. Because this behavior can lead to inefficiencies, we identify certain specific combinations that perhaps should be prohibited in the bidding process. Our results also suggest that market share restrictions and running sequential auctions promote competition in the longrun, without significantly increasing the shortrun cost for the government due to unrealized cost synergies. Our results highlight that the simultaneous consideration of the firms ’ operational cost structure and their strategic behavior is key to the successful design of a CA. More broadly, our paper is the first to provide an econometric study of a largescale CA, providing novel and substantive insights regarding bidding behavior in this type of auctions.