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Mechanisms for Combinatorial Auctions with Budget Constraints

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  • Le, Phuong

Abstract

This paper studies combinatorial auctions with budget-constrained bidders from a mechanism design perspective. I search for mechanisms that are incentive compatible, individually rational, symmetric, non-wasteful and non-bossy. First focusing on the greedy domain, in which any increase in a bidder's valuation always exceeds his budget, I derive the unique mechanism, called the Iterative Second Price Auction. For the general domain, however, no such mechanism exists.

Suggested Citation

  • Le, Phuong, 2015. "Mechanisms for Combinatorial Auctions with Budget Constraints," MPRA Paper 66292, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:66292
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    File URL: https://mpra.ub.uni-muenchen.de/66292/1/MPRA_paper_66291.pdf
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    References listed on IDEAS

    as
    1. Che, Yeon-Koo & Gale, Ian, 2000. "The Optimal Mechanism for Selling to a Budget-Constrained Buyer," Journal of Economic Theory, Elsevier, vol. 92(2), pages 198-233, June.
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    4. Lawrence M. Ausubel, 2004. "An Efficient Ascending-Bid Auction for Multiple Objects," American Economic Review, American Economic Association, vol. 94(5), pages 1452-1475, December.
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    7. Paul Milgrom, 2000. "Putting Auction Theory to Work: The Simultaneous Ascending Auction," Journal of Political Economy, University of Chicago Press, vol. 108(2), pages 245-272, April.
    8. Che, Yeon-Koo & Gale, Ian, 1996. "Expected revenue of all-pay auctions and first-price sealed-bid auctions with budget constraints," Economics Letters, Elsevier, vol. 50(3), pages 373-379, March.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Combinatorial Auctions; Budget Constraints; Mechanisms;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design

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