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The performance of deferred-acceptance auctions

Dütting, Paul, Gkatzelis, Vasilis and Roughgarden, Tim (2017) The performance of deferred-acceptance auctions. Mathematics of Operations Research, 42 (4). pp. 897-914. ISSN 0364-765X

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Identification Number: 10.1287/moor.2016.0835

Abstract

Deferred-acceptance auctions are mechanisms whose allocation rule can be implemented using an adaptive reverse greedy algorithm. Milgrom and Segal recently introduced these auctions and proved that they satisfy remarkable incentive guarantees: in addition to being dominant strategy and incentive compatible, they are weakly group-strategyproof and can be implemented by ascending-clock auctions. Neither forward greedy mechanisms nor the VCG mechanism generally possess any of these additional incentive properties. The goal of this paper is to initiate the study of deferred-acceptance auctions from an approximation standpoint. We study what fraction of the optimal social welfare can be guaranteed by these auctions in two canonical problems, knapsack auctions and combinatorial auctions with single-minded bidders. For knapsack auctions, we prove a separation between deferred-acceptance auctions and arbitrary dominant-strategy incentive-compatible mechanisms. For combinatorial auctions with single-minded bidders, we design novel polynomial-time mechanisms that achieve the best of both worlds: the incentive guarantees of a deferred-acceptance auction, and approximation guarantees close to the best possible.

Item Type: Article
Official URL: http://pubsonline.informs.org/journal/moor
Additional Information: © 2017 Informs
Divisions: Mathematics
Subjects: Q Science > QA Mathematics
Sets: Departments > Mathematics
Date Deposited: 15 Nov 2017 10:30
Last Modified: 20 Mar 2019 03:21
URI: http://eprints.lse.ac.uk/id/eprint/85524

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