Dictatorial mechanisms in constrained combinatorial auctions

Anat Lerner, Rica Gonen

Research output: Contribution to journalArticlepeer-review

Abstract

We study the possibility space of deterministic, dominant-strategy incentive compatible, individually rational, and Pareto efficient combinatorial auctions in a model with two players and two nonidentical items (four outcomes). Our model has multidimensional types, private values, nonnegative prices, and quasilinear preferences for the players with one relaxation - the players are subject to publicly known budget constraints. We show that the space we study essentially includes one type of mechanisms: autocratic mechanisms (a form of dictatorship). Furthermore, we prove that there are families of autocratic mechanisms that uniquely fulfill the basic properties of deterministic, dominant-strategy incentive compatible, individually rational, and Pareto efficient. The mechanisms in the autocratic families are identical except for two to three price parameters that differentiate them.

Original languageEnglish
Pages (from-to)363-380
Number of pages18
JournalB.E. Journal of Theoretical Economics
Volume13
Issue number1
DOIs
StatePublished - 8 May 2013

Bibliographical note

Publisher Copyright:
© 2013 by Walter de Gruyter Berlin / Boston 2013.

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