Year: 2025
Type: preprint
Abstract: Building on the linear programming approach to competitive equilibrium pricing, we develop a general method for constructing iterative auctions that achieve Vickrey-Clarke-Groves (VCG) outcomes. We show how to transform a linear program characterizing competitive equilibrium prices into one that characterizes universal competitive equilibrium (UCE) prices, which elicit precisely the information needed to compute VCG payments. By applying a primal-dual algorithm to these transformed programs, we derive iterative Vickrey auctions that maintain a single price path, eliminating the overhead and incentive problems associated with multiple price paths used solely for payment calculations. We demonstrate the versatility of our method by developing a novel iterative Vickrey auction for the multi-unit setting and an iterative variant of the Product-Mix auction. The resulting auctions combine the transparency of iterative price discovery with the efficiency and incentive properties of the VCG mechanism.
Source: arXiv (Cornell University)
Authors: Lahaie, Sébastien, Lubin, Benjamin
Institutions: Google (United States), Boston University
Language: English
Field: Decision Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W4415344176
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