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Computational Mechanism Design Optimal Auction Design

# In a single experiment all agents have the same and c

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Unformatted text preview: roblem Fig 3 compares the e ciency a, and revenue b, for markets with N = 10 agents as the e ectiveness 1 ,  and cost C of deliberation changes. In a single experiment all agents have the same and C parameters. Equivalently, we model agents with the same bounded resources, but easy local problems for large 1 ,  and relaxed time-constraints for small costs C . 9 C = 0.05 100 90 100 90 C = 0.1 100 90 C = 0.05 100 90 C = 0.1 Efficiency (%) Efficiency (%) Revenue (%) 80 70 60 50 40 0 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α C = 0.5 100 90 80 70 60 50 40 0 80 70 60 50 Revenue (%) 0 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α C = 0.5 80 70 60 50 40 0 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α C=1 100 90 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α C=1 40 100 90 100 90 Efficiency (%) Efficiency (%) Revenue (%) 80 70 60 50 40 0 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α 80 70 60 50 40 0 80 70 60 50 Revenue (%) 0 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α 80 70 60 50 40 0 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α a b Fig. 3. Auction performance for N = 10 agents with di erent levels of deliberation e ectiveness and cost. `+' ascending-price; `x' sealed-bid; `o' posted-price sequential auctions. Bid increment = 0:4, 1000 trials. a E ciency; b Revenue. 0.2 0.4 0.6 0.8 Computational Effectiveness, 1 − α 40 In this market, with N = 10 agents, when agents have small deliberation costs C = 0:05 then A S P , and A  S P for C = 0:1. Auctions with dynamic prices, such as the ascending-price or sealed-bid auctions, perform better than the posted-price auction for small C . For medium deliberation costs C = 0:5, the sealed-bid auction fails and A  P S . For large deliberation costs e.g. C = 1 there is no deliberation in any auction, and auction design does not matter. E ciency and revenue increase as deliberation e ectiveness increases, and decrease as deliberation cost increases. The ascending-price and sealed...
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