Research Article
Information Feedback and Efficiency in Multiattribute Double Auctions
@INPROCEEDINGS{10.1007/978-3-642-03821-1_6, author={Kevin Lochner and Michael Wellman}, title={Information Feedback and Efficiency in Multiattribute Double Auctions}, proceedings={Auctions, Market Mechanisms and Their Applications. First International ICST Conference, AMMA 2009, Boston, MA, USA, May 8-9, 2009, Revised Selected Papers}, proceedings_a={AMMA}, year={2012}, month={5}, keywords={}, doi={10.1007/978-3-642-03821-1_6} }- Kevin Lochner
Michael Wellman
Year: 2012
Information Feedback and Efficiency in Multiattribute Double Auctions
AMMA
Springer
DOI: 10.1007/978-3-642-03821-1_6
Abstract
We investigate tradeoffs among expressiveness, operational cost, and economic efficiency for a class of multiattribute double-auction markets. To enable polynomial-time clearing and information feedback operations, we restrict the bidding language to a form of multiattribute OR-of-XOR expressions. We then consider implications of this restriction in environments where bidders’ preferences lie within a strictly larger class, that of complement-free valuations. Using valuations derived from a supply chain scenario, we show that an iterative bidding protocol can overcome the limitations of this language restriction. We further introduce a metric characterizing the degree to which valuations violate the substitutes condition, theoretically known to guarantee efficiency, and present experimental evidence that the actual efficiency loss is proportional to this metric.