An efficient and incentive compatible dynamic auction for multiple complements

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Publication details

Journaljournal of Political Economy
DatePublished - Apr 2014
Issue number2
Volume122
Number of pages45
Pages (from-to)422-466
Original languageEnglish

Abstract

This article proposes an efficient and incentive compatible dynamic auction for selling multiple complementary goods. The seller has reserve prices. The auctioneer announces a current price for every bundle of goods and a supply set of goods, every bidder responds with a set of goods demanded at these prices, and the auctioneer adjusts prices. We prove that even when bidders can exercise their market power strategically, this dynamic auction always induces them to bid truthfully, resulting in an efficient allocation, its supporting Walrasian equilibrium price for every bundle of goods, and a generalized VickreyClarke-Groves payment for every bidder.

    Research areas

  • auction design, Incomplete information, EFFICIENCY, dynamic auction, incentive, equilibrium

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