Optimal bidding in auctions from a game theory perspective

•We review recent advances in auction theory from a game theoretic perspective.•We consider estimation issues and the effect of asymmetry on bidding.•We examine how auctions are embedded in the market.•We investigate bidding when players break the rules.•We expand the perspective by incorporating ir...

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Veröffentlicht in:European journal of operational research Jg. 248; H. 2; S. 347 - 371
1. Verfasser: Lorentziadis, Panos L.
Format: Journal Article
Sprache:Englisch
Veröffentlicht: Amsterdam Elsevier B.V 16.01.2016
Elsevier Sequoia S.A
Schlagworte:
Asymmetry
Auction bidding
Auctions
Behavioral decision theory
Bids
Collusion
Game theory
Irrationality
Studies
Collusion
Irrationality
Asymmetry
Game theory
Auction bidding
ISSN:0377-2217, 1872-6860
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Beschreibung
Zusammenfassung:•We review recent advances in auction theory from a game theoretic perspective.•We consider estimation issues and the effect of asymmetry on bidding.•We examine how auctions are embedded in the market.•We investigate bidding when players break the rules.•We expand the perspective by incorporating irrationality in bidding. The game theoretic perspective in auction bidding has provided a powerful normative framework for the analysis of auctions and it has generated an impressive volume of research contributions. Tracing this research, we review key recent advances, which have greatly expanded our understanding of the operation of auctions and produced a more accurate analysis of mechanism design and optimal bidding. We follow various experimental studies which have shown that the predictive power of auction theory remains in many cases limited. For this reason, we concentrate on research themes, which enhance the applicability of auction theory leading to more realistic descriptions of bidding behaviors. We identify important innovations, which expand the environment of auction bidding and carry us beyond rational decision making. We conclude providing directions of future research and discussing their implications.
Bibliographie:SourceType-Scholarly Journals-1
ObjectType-Feature-1
content type line 14
ISSN:0377-2217
1872-6860
DOI:10.1016/j.ejor.2015.08.012