Mechanism Design in the Case of Two Objects with the Possibility for Complementarities
Abstract
This research builds upon existing studies in that it investigates the possibility
of expanding the mathematical and theoretical models of FPSB auctions, along with
a slightly altered versions of this auction format, into a linear program in order
to solve it with numerical techniques. The output generated from the linear optimization
model suggests that the auction mechanisms being used today for the sale of multiple
objects with complementarities may well be inefficient in maximizing seller’s revenue.
The results further establish a basis for comparison of equilibrium surplus from the
seller’s perspective in the case of an auction with two complementary objects. Moreover,
the analytical and numerical results herein serve as a building block for future research
examining different mechanism designs that will maximize seller revenue in a given
auction.
Type
Honors thesisDepartment
EconomicsSubject
Auction TheoryMechanism Design
Complementarity Values
Multiple Object Auction
First-Price Sealed Bid
Optimal Mechanism
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https://hdl.handle.net/10161/3555Citation
Varma, Avtar (2011). Mechanism Design in the Case of Two Objects with the Possibility for Complementarities.
Honors thesis, Duke University. Retrieved from https://hdl.handle.net/10161/3555.Collections
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