Work

Buyers’ welfare maximizing auction design: comment

Year: 2024

Type: article

Abstract: In an earlier paper published in this journal, Bauer (2023) claims to have constructed an auction format that maximizes buyers’ welfare. We note that the characterization of such a mechanism in Proposition 1 of Bauer (2023) is incomplete because it does not precisely specify the payment rule. Because of that, the discussion following this proposition is misleading and the mechanism proposed in the example is not incentive compatible. The complete characterization of the optimal mechanism is the one from Krishna and Perry (1998).

Source: International Journal of Game Theory

DOI: 10.1007/s00182-024-00904-4

Author: Dmitriy Knyazev

Institution: University of Vienna

Language: English

Topic: Auction Theory and Applications

Subfield: Management Science and Operations Research

Field: Decision Sciences

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $2,990

Funder: Universität Wien