Truthful Outcomes from Non-Truthful Position Auctions
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CitationDütting, Paul, Felix Fischer, and David C. Parkes. 2016. Truthful Outcomes from Non-Truthful Position Auctions. In Proceedings of the 2016 ACM Conference on Economics and Computation, Maastricht, Netherlands, July 24-28, 2016.
AbstractWe exhibit a property of the VCG mechanism that can help explain the surprising rarity with which it is used even in settings with unit demand: a relative lack of robustness to inaccuracies in the choice of its parameters. For a standard position auction environment in which the auctioneer may not know the precise relative values of the positions, we show that under both complete and incomplete information a non-truthful mechanism supports the truthful outcome of the VCG mechanism for a wider range of these values than the VCG mechanism itself. The result for complete information concerns the generalized second-price mechanism and lends additional theoretical support to the use of this mechanism in practice. Particularly interesting from a technical perspective is the case of incomplete information, where a surprising combinatorial equivalence helps us to avoid confrontation with an unwieldy differential equation.
Citable link to this pagehttp://nrs.harvard.edu/urn-3:HUL.InstRepos:32227268
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