Expressiveness and Robustness of First-Price Position Auctions

Dütting, P., Fischer, F. and Parkes, D. C. (2014) Expressiveness and Robustness of First-Price Position Auctions. In: 15th ACM Conference on Economics and Computation, Palo Alto, CA, USA, 8-12 June 2014, pp. 57-74. ISBN 9781450325653 (doi: 10.1145/2600057.2602846)

Abstract

It is desirable for an economic mechanism that its properties hold in a robust way across multiple equilibria and under varying assumptions regarding the information available to the participants. In this paper we focus on the design of position auctions and seek mechanisms that guarantee high revenue in every efficient equilibrium under both complete and incomplete information. Our main result identifies a generalized first-price auction with multi-dimensional bids as the only standard design capable of achieving this goal, even though valuations are one-dimensional. The fact that expressiveness beyond the valuation space is necessary for robustness provides an interesting counterpoint to previous work, which has highlighted the benefits of simple bid spaces. From a technical perspective, our results are interesting because they establish equilibrium existence for a multi-dimensional bid space, where standard techniques for establishing equilibrium existence break down.

• Item Type: Conference Proceedings
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Fischer, Dr Felix
• Authors: Dütting, P., Fischer, F., and Parkes, D. C.
• College/School: College of Science and Engineering > School of Computing Science
• ISBN: 9781450325653