Vickrey–Dutch procurement auction for multiple items

Mishra, Debasis and Veeramani, Dharmaraj (2007) Vickrey–Dutch procurement auction for multiple items. In: European Journal of Operational Research, 180 (2). pp. 617-629.

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Abstract

We consider a setting where there is a manufacturer who wants to procure multiple items from a set of suppliers each of whom can supply one or more of these items (bundles). We design an ascending price auction for such a setting which implements the Vickrey–Clarke–Groves outcome and truthful bidding is an ex post Nash equilibrium. Our auction maintains non-linear and non-anonymous prices throughout the auction. This auction has a simple price adjustment step and is easy to implement in practice. As offshoots of this auction, we also suggest other simple auctions (in which truthful bidding is not an equilibrium by suppliers) which may be suitable where incentives to suppliers are not a big concern. Computer simulations of our auction show that it is scalable for the multi-unit case, and has better information revelation properties than its descending auction counterpart.

Item Type:	Journal Article
Publication:	European Journal of Operational Research
Publisher:	Elsevier
Additional Information:	Copyright of this article belongs to Elsevier.
Keywords:	Iterative auctions;Procurement auctions;Vickrey–Dutch auctions;Winner determination problem
Department/Centre:	Division of Electrical Sciences > Computer Science & Automation
Date Deposited:	30 Nov 2007
Last Modified:	19 Sep 2010 04:38
URI:	http://eprints.iisc.ac.in/id/eprint/11162

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