An Approximation Algorithm for Multi-Unit Auctions : Numerical and Subject Experiments

In multi-unit auctions for a single item, the Vickrey-Clarke-Groves mechanism (VCG) attains allocative efficiency but suffers from its computational complexity. Takahashi and Shigeno thus proposed a greedy based approximation algorithm (GBA). In a subject experiment there was truly a difference in e...

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Vydáno v:Operations research and decisions Ročník 28; číslo no. 1; s. 95 - 115
Hlavní autoři: Satoshi Takahashi, Yoichi Izunaga, Naoki Watanabe
Médium: Journal Article
Jazyk:angličtina
Vydáno: Wrocław University of Science and Technology 01.01.2018
ISSN:2081-8858, 2391-6060
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Shrnutí:In multi-unit auctions for a single item, the Vickrey-Clarke-Groves mechanism (VCG) attains allocative efficiency but suffers from its computational complexity. Takahashi and Shigeno thus proposed a greedy based approximation algorithm (GBA). In a subject experiment there was truly a difference in efficiency rate but no significant difference in seller's revenue between GBA and VCG. It is not clear in theory whether each bidder will submit his or her true unit valuations in GBA. We show, however, that in a subject experiment there was no significant difference in the number of bids that obey "almost" truth-telling between GBA and VCG. As for individual bidding behavior, GBA and VCG show a sharp contrast when a human bidder competes against machine bidders; underbidding was observed in GBA, while overbidding was observed in VCG. Some results in a numerical experiment are also provided prior to reporting those observations. (original abstract)
ISSN:2081-8858
2391-6060
DOI:10.5277/ord180106