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A Vickrey auction is decision efficient (the winner is the bidder with the highest valuation) under the most general circumstances; [citation needed] it thus provides a baseline model against which the efficiency properties of other types of auctions can be posited. It is only ex-post efficient (sum of transfers equal to zero) if the seller is ...
A well-known special case is the Vickrey auction, or the sealed second-bid auction. Here, there is only a single item, and the set contains + possible outcomes: either sell the item to one of the agents, or not to sell it at all. In step 3, the winner agent is paid 0 (since the total value of the others is 0) and the losers receive a payment ...
A Vickrey–Clarke–Groves (VCG) auction is a type of sealed-bid auction of multiple items. Bidders submit bids that report their valuations for the items, without knowing the bids of the other bidders. The auction system assigns the items in a socially optimal manner: it charges each individual the harm they cause to other bidders. [1]
Online auctions often use an equivalent version of Vickrey's second-price auction wherein bidders provide proxy bids for items. A proxy bid is an amount an individual values some item at. The online auction house will bid up the price of the item until the proxy bid for the winner is at the top.
A classic example is the pair of auction mechanisms: first price auction and second price auction. First-price auction has a variant which is Bayesian-Nash incentive compatible; second-price auction is dominant-strategy-incentive-compatible, which is even stronger than Bayesian-Nash incentive compatible. The two mechanisms fulfill the ...
The generalized second-price auction (GSP) is a non-truthful auction mechanism for multiple items. Each bidder places a bid. The highest bidder gets the first slot, the second-highest, the second slot and so on, but the highest bidder pays the price bid by the second-highest bidder, the second-highest pays the price bid by the third-highest, and so on.
The set went on to sell for over $8 million at a Sotheby’s auction in early 2024, smashing records for the most expensive sneakers ever sold in history. 2. Michael Jordan’s 1998 NBA Finals ...
Example. [3] There are two buyers whose valuations are distributed uniformly in the range [ $ 100 , $ 200 ] {\displaystyle [\$100,\$200]} . The BO auction is the Vickrey auction with reserve price $100 (= the inverse-virtual-valuation of 0).
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