Efficiency in truthful auctions via a social network

Seiji Takanashi, Takehiro Kawasaki, Taiki Todo, Makoto Yokoo

Research output: Contribution to journalArticlepeer-review

Abstract

In this paper, we study efficiency in truthful auctions via a social network, where a seller can only spread the information of an auction to the buyers through the buyers' network. In single-item auctions, we show that no mechanism is strategy-proof, individually rational, efficient, and weakly budget balanced. In addition, we propose α-APG mechanisms, a class of mechanisms which operate a trade-off between efficiency and weakly budget balancedness. In multi-item auctions, there already exists a strategy-proof mechanism when all buyers need only one item. However, we indicate a counter-example to strategy-proofness in this mechanism, and to the best of our knowledge, the question of finding a strategy-proof mechanism remains open. We assume that all buyers have decreasing marginal utility and propose a generalized APG mechanism that is strategy-proof and individually rational but not efficient. Importantly, we show that this mechanism achieves the largest efficiency measure among all strategy-proof mechanisms.

Original languageEnglish
JournalUnknown Journal
Publication statusPublished - Apr 28 2019

All Science Journal Classification (ASJC) codes

  • General

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