IDEAS home Printed from https://ideas.repec.org/a/inm/ordeca/v7y2010i1p58-77.html
   My bibliography  Save this article

A Practical Combinatorial Clock Exchange for Spectrum Licenses

Author

Listed:
  • Karla Hoffman

    (Department of Systems Engineering and Operations Research, George Mason University, Fairfax, Virginia 22030)

  • Dinesh Menon

    (Decisive Analytics Corporation, Arlington, Virginia 22202)

Abstract

A centralized combinatorial exchange has been considered as a means to enable efficient restructuring of spectrum holdings by allowing traders to buy and sell spectrum resources. We propose a new, two-sided, multiple-round, combinatorial clock exchange mechanism that enables traders to specify reserve prices and submit consolidated bundle orders on spectrum assets to be bought and sold. Any trader may submit multiple orders over several rounds. A trading agent's order can only be executed when it matches with bids and asks from one or more other agents. Acceptable bid and ask prices are adjusted each round to decrease the spread, and the final, market-clearing trades are executed to maximize the gains from trade. This paper outlines the clock mechanism and presents a new approach for allocation of surplus among the market-clearing agents to maximize incentives for participation.

Suggested Citation

  • Karla Hoffman & Dinesh Menon, 2010. "A Practical Combinatorial Clock Exchange for Spectrum Licenses," Decision Analysis, INFORMS, vol. 7(1), pages 58-77, March.
    • Handle: RePEc:inm:ordeca:v:7:y:2010:i:1:p:58-77
    DOI: 10.1287/deca.1090.0169
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/deca.1090.0169
    Download Restriction: no
    File URL: https://libkey.io/10.1287/deca.1090.0169?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Myerson, Roger B. & Satterthwaite, Mark A., 1983. "Efficient mechanisms for bilateral trading," Journal of Economic Theory, Elsevier, vol. 29(2), pages 265-281, April.
    2. Bikhchandani, Sushil & Ostroy, Joseph M., 2002. "The Package Assignment Model," Journal of Economic Theory, Elsevier, vol. 107(2), pages 377-406, December.
    3. Robert W. Day & S. Raghavan, 2007. "Fair Payments for Efficient Allocations in Public Sector Combinatorial Auctions," Management Science, INFORMS, vol. 53(9), pages 1389-1406, September.
    4. Christoph Brunner & Jacob K. Goeree & Charles A. Holt & John O. Ledyard, 2010. "An Experimental Test of Flexible Combinatorial Spectrum Auction Formats," American Economic Journal: Microeconomics, American Economic Association, vol. 2(1), pages 39-57, February.
    5. Milgrom, Paul R & Weber, Robert J, 1982. "A Theory of Auctions and Competitive Bidding," Econometrica, Econometric Society, vol. 50(5), pages 1089-1122, September.
    6. SCHMEIDLER, David, 1969. "The nucleolus of a characteristic function game," LIDAM Reprints CORE 44, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    7. Bossaerts, Peter & Fine, Leslie & Ledyard, John, 2002. "Inducing liquidity in thin financial markets through combined-value trading mechanisms," European Economic Review, Elsevier, vol. 46(9), pages 1671-1695, October.
    8. Walter Kern & Daniël Paulusma, 2003. "Matching Games: The Least Core and the Nucleolus," Mathematics of Operations Research, INFORMS, vol. 28(2), pages 294-308, May.
    9. Abrache, Jawad & Crainic, Teodor Gabriel & Gendreau, Michel, 2005. "Models for bundle trading in financial markets," European Journal of Operational Research, Elsevier, vol. 160(1), pages 88-105, January.
    10. Kelso, Alexander S, Jr & Crawford, Vincent P, 1982. "Job Matching, Coalition Formation, and Gross Substitutes," Econometrica, Econometric Society, vol. 50(6), pages 1483-1504, November.
    11. Paul Milgrom, 2007. "Package Auctions and Exchanges," Econometrica, Econometric Society, vol. 75(4), pages 935-965, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. L. Robin Keller, 2011. "From the Editor ---Multiattribute and Intertemporal Preferences, Probability, and Stochastic Processes: Models and Assessment," Decision Analysis, INFORMS, vol. 8(3), pages 165-169, September.
    2. Chen, Haoxun, 2016. "Combinatorial clock-proxy exchange for carrier collaboration in less than truck load transportation," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 91(C), pages 152-172.
    3. Robert F. Bordley & Elena Katok & L. Robin Keller, 2010. "Honoring Michael H. Rothkopf's Legacy of Rigor and Relevance in Auction Theory: From the Editors," Decision Analysis, INFORMS, vol. 7(1), pages 1-4, March.
    4. Jeong, Seungwon (Eugene) & Lee, Joosung, 2024. "The groupwise-pivotal referral auction: Core-selecting referral strategy-proof mechanism," Games and Economic Behavior, Elsevier, vol. 143(C), pages 191-203.
    5. Lindsay, Luke, 2018. "Shapley value based pricing for auctions and exchanges," Games and Economic Behavior, Elsevier, vol. 108(C), pages 170-181.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ning Sun & Zaifu Yang, 2014. "An Efficient and Incentive Compatible Dynamic Auction for Multiple Complements," Journal of Political Economy, University of Chicago Press, vol. 122(2), pages 422-466.
    2. Martin Bichler & Pasha Shabalin & Georg Ziegler, 2013. "Efficiency with Linear Prices? A Game-Theoretical and Computational Analysis of the Combinatorial Clock Auction," Information Systems Research, INFORMS, vol. 24(2), pages 394-417, June.
    3. Robert Kleinberg & Bo Waggoner & E. Glen Weyl, 2016. "Descending Price Optimally Coordinates Search," Papers 1603.07682, arXiv.org, revised Dec 2016.
    4. Michel Le Breton & Juan Moreno-Ternero & Alexei Savvateev & Shlomo Weber, 2013. "Stability and fairness in models with a multiple membership," International Journal of Game Theory, Springer;Game Theory Society, vol. 42(3), pages 673-694, August.
    5. Zhiling Guo & Gary J. Koehler & Andrew B. Whinston, 2012. "A Computational Analysis of Bundle Trading Markets Design for Distributed Resource Allocation," Information Systems Research, INFORMS, vol. 23(3-part-1), pages 823-843, September.
    6. Jeong, Seungwon (Eugene) & Lee, Joosung, 2024. "The groupwise-pivotal referral auction: Core-selecting referral strategy-proof mechanism," Games and Economic Behavior, Elsevier, vol. 143(C), pages 191-203.
    7. Ausubel Lawrence M & Milgrom Paul R, 2002. "Ascending Auctions with Package Bidding," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 1(1), pages 1-44, August.
    8. Akiyoshi Shioura & Zaifu Yang, 2013. "Equilibrium, Auction, Multiple Substitutes and Complements," Discussion Papers 13/17, Department of Economics, University of York.
    9. Scott Duke Kominers & Alexander Teytelboym & Vincent P Crawford, 2017. "An invitation to market design," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 33(4), pages 541-571.
    10. Blume, Lawrence E. & Easley, David & Kleinberg, Jon & Tardos, Éva, 2009. "Trading networks with price-setting agents," Games and Economic Behavior, Elsevier, vol. 67(1), pages 36-50, September.
    11. Lawrence M. Ausubel & Paul Milgrom, 2004. "Ascending Proxy Auctions," Discussion Papers 03-035, Stanford Institute for Economic Policy Research.
    12. Committee, Nobel Prize, 2020. "Improvements to auction theory and inventions of new auction formats," Nobel Prize in Economics documents 2020-2, Nobel Prize Committee.
    13. Núñez, Marina & Rafels, Carlos & Robles, Francisco, 2020. "A mechanism for package allocation problems with gross substitutes," Journal of Mathematical Economics, Elsevier, vol. 87(C), pages 6-14.
    14. Blumrosen, Liad & Nisan, Noam, 2010. "Informational limitations of ascending combinatorial auctions," Journal of Economic Theory, Elsevier, vol. 145(3), pages 1203-1223, May.
    15. Martin Bichler & Vladimir Fux & Jacob Goeree, 2018. "A Matter of Equality: Linear Pricing in Combinatorial Exchanges," Information Systems Research, INFORMS, vol. 29(4), pages 1024-1043, December.
    16. Heiner Ackermann & Hendrik Ewe & Karl-Heinz Küfer & Michael Schröder, 2014. "Modeling profit sharing in combinatorial exchanges by network flows," Annals of Operations Research, Springer, vol. 222(1), pages 5-28, November.
    17. Martin Bichler & Pasha Shabalin & Alexander Pikovsky, 2009. "A Computational Analysis of Linear Price Iterative Combinatorial Auction Formats," Information Systems Research, INFORMS, vol. 20(1), pages 33-59, March.
    18. Laurent Lamy, 2009. "Ascending auctions: some impossibility results and their resolutions with final price discounts," PSE Working Papers halshs-00575076, HAL.
    19. Laurent Lamy, 2009. "Ascending auctions: some impossibility results and their resolutions with final price discounts," Working Papers halshs-00575076, HAL.
    20. Erlanson, Albin & Szwagrzak, Karol, 2013. "Strategy-Proof Package Assignment," Working Papers 2013:43, Lund University, Department of Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ordeca:v:7:y:2010:i:1:p:58-77. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.