MIDA: A Multi Item-type Double-Auction Mechanism,

E. Segal-Halevi, A. Hassidim, Y. Aumann

Research output: Working paper / PreprintPreprint

Abstract

In a seminal paper, McAfee (1992) presented a truthful mechanism for double auction, attaining asymptotically-optimal gain-from-trade without any prior information onthevaluationsofthetraders. McAfee’smechanismhandlessingle-parametricagents, allowing each seller to sell a single item and each buyer to buy a single item. In this paper, we extend McAfee’s mechanism to handle multi-parametric agents and allow multiple items per trader. We consider three different settings. (1) There is one item-type. Each seller is endowed with several units of that item and each buyer may want several units of that item. Buyers and sellers have diminishing marginal returns. (2) There are multiple item-types. Each seller is endowed with several units of a pre-specified type and the buyers have unit-demand valuations. (3) There are multiple item-types. Each seller is endowed with several units of a pre-specified type and the buyers have gross-substitute valuations. The mechanism is a combination of random-sampling, posted pricing and twosided random-serial-dictatorship. It is prior-free, universally individually-rational, dominant-strategytruthful andstronglybudget-balanced. Itsgain-from-tradeapproaches the optimum when the market in all item types is sufficiently large.
Original languageEnglish
Number of pages43
Volume6210
StatePublished - 5 Aug 2016

Publication series

NamearXiv preprint arXiv:1604.,

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