Risk-Free Bidding in Complement-Free Combinatorial Auctions

11/29/2021
by   Vishnu V. Narayan, et al.
0

We study risk-free bidding strategies in combinatorial auctions with incomplete information. Specifically, what is the maximum profit that a complement-free (subadditive) bidder can guarantee in a multi-item combinatorial auction? Suppose there are n bidders and B_i is the value that bidder i has for the entire set of items. We study the above problem from the perspective of the first bidder, Bidder 1. In this setting, the worst case profit guarantees arise in a duopsony, that is when n=2, so this problem then corresponds to playing an auction against a budgeted adversary with budget B_2. We present worst-case guarantees for two simple and widely-studied combinatorial auctions, namely, the sequential and simultaneous auctions, for both the first-price and second-price case. In the general case of distinct items, our main results are for the class of fractionally subadditive (XOS) bidders, where we show that for both first-price and second-price sequential auctions Bidder 1 has a strategy that guarantees a profit of at least (√(B_1)-√(B_2))^2 when B_2 ≤ B_1, and this bound is tight. More profitable guarantees can be obtained for simultaneous auctions, where in the first-price case, Bidder 1 has a strategy that guarantees a profit of at least (B_1-B_2)^2/2B_1, and in the second-price case, a bound of B_1-B_2 is achievable. We also consider the special case of sequential auctions with identical items, for which we provide tight guarantees for bidders with subadditive valuations.

READ FULL TEXT

page 1

page 2

page 3

page 4

research
07/28/2020

Simple combinatorial auctions with budget constraints

We study the efficiency of simple combinatorial auctions for the allocat...
research
07/20/2020

The Price of Anarchy of Two-Buyer Sequential Multiunit Auctions

We study the efficiency of sequential multiunit auctions with two-buyers...
research
07/26/2016

The Price of Anarchy in Auctions

This survey outlines a general and modular theory for proving approximat...
research
11/24/2020

The Cost of Simple Bidding in Combinatorial Auctions

We study the complexity of bidding optimally in one-shot combinatorial a...
research
05/03/2023

Stackelberg Attacks on Auctions and Blockchain Transaction Fee Mechanisms

We study an auction with m identical items in a context where n agents c...
research
07/12/2021

Worst-Case Welfare of Item Pricing in the Tollbooth Problem

We study the worst-case welfare of item pricing in the tollbooth problem...
research
05/04/2022

Estimation of Standard Auction Models

We provide efficient estimation methods for first- and second-price auct...

Please sign up or login with your details

Forgot password? Click here to reset