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Multi-Unit Open Ascending Price Efficient Auction

Author

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  • Sergei Izmalkov

    (Department of Economics, MIT)

Abstract

This paper presents an open ascending price mechanism that allocates efficiently M units of the same good among N bidders with interdependent values The mechanism consists of a number of sequential English auctions with reentry and has the following attributes. In each of the individual auctions all the bidders compete simultaneously in the open ascending price format. The most distinctive feature of the mechanism is that winners are determined first, and then additional auxillary auctions are conducted to determine prices. The total number of auctions depends only on the number of goods to be allocated and not on the number of bidders.

Suggested Citation

  • Sergei Izmalkov, 2004. "Multi-Unit Open Ascending Price Efficient Auction," Working Papers 2004.91, Fondazione Eni Enrico Mattei.
    • Handle: RePEc:fem:femwpa:2004.91
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    References listed on IDEAS

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    1. Dirk Bergemann & Stephen Morris, 2012. "Robust Mechanism Design," World Scientific Book Chapters, in: Robust Mechanism Design The Role of Private Information and Higher Order Beliefs, chapter 2, pages 49-96, World Scientific Publishing Co. Pte. Ltd..
    2. Ken Binmore & Paul Klemperer, 2002. "The Biggest Auction Ever: the Sale of the British 3G Telecom Licences," Economic Journal, Royal Economic Society, vol. 112(478), pages 74-96, March.
    3. Jehiel, Philippe & Moldovanu, Benny, 2001. "Efficient Design with Interdependent Valuations," Econometrica, Econometric Society, vol. 69(5), pages 1237-1259, September.
    4. Porter, Robert H, 1995. "The Role of Information in U.S. Offshore Oil and Gas Lease Auctions," Econometrica, Econometric Society, vol. 63(1), pages 1-27, January.
    5. William Vickrey, 1961. "Counterspeculation, Auctions, And Competitive Sealed Tenders," Journal of Finance, American Finance Association, vol. 16(1), pages 8-37, March.
    6. Partha Dasgupta & Eric Maskin, 2000. "Efficient Auctions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(2), pages 341-388.
    7. Rothkopf, Michael H & Teisberg, Thomas J & Kahn, Edward P, 1990. "Why Are Vickrey Auctions Rare?," Journal of Political Economy, University of Chicago Press, vol. 98(1), pages 94-109, February.
    8. Birulin, Oleksii & Izmalkov, Sergei, 2011. "On efficiency of the English auction," Journal of Economic Theory, Elsevier, vol. 146(4), pages 1398-1417, July.
    9. Motty Perry & Philip J. Reny, 2002. "An Efficient Auction," Econometrica, Econometric Society, vol. 70(3), pages 1199-1212, May.
    10. Milgrom, Paul R & Weber, Robert J, 1982. "A Theory of Auctions and Competitive Bidding," Econometrica, Econometric Society, vol. 50(5), pages 1089-1122, September.
    11. Cremer, Jacques & McLean, Richard P, 1985. "Optimal Selling Strategies under Uncertainty for a Discriminating Monopolist When Demands Are Interdependent," Econometrica, Econometric Society, vol. 53(2), pages 345-361, March.
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    Cited by:

    1. Shapiro, Jeremy, 2019. "The impact of recipient choice on aid effectiveness," World Development, Elsevier, vol. 116(C), pages 137-149.

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    More about this item

    Keywords

    Multiple units; Interdependent values; Sequential auctions; Ascending price auction;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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