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Multilateral deferred-acceptance mechanisms. (English) Zbl 1406.91158
Markakis, Evangelos (ed.) et al., Web and internet economics. 11th international conference, WINE 2015, Amsterdam, The Netherlands, December 9–12, 2015. Proceedings. Berlin: Springer (ISBN 978-3-662-48994-9/pbk; 978-3-662-48995-6/ebook). Lecture Notes in Computer Science 9470, 173-186 (2015).
Summary: We study the design of multilateral markets, where agents with several different roles engage in trade. We first observe that the modular approach proposed by P. Dütting et al. [Games Econ. Behav. 105, 59–83 (2017; Zbl 1415.91136)] for bilateral markets can also be applied in multilateral markets. This gives a general method to design Deferred Acceptance mechanisms in such settings; these mechanisms, defined by P. Milgrom and I. Segal [“Deferred-acceptance auctions and radio spectrum reallocation”, in: Proceedings of the 15th ACM conference on economics and computation, EC’14. New York, NY: Association for Computing Machinery (ACM). 185–186 (2014; doi:10.1145/2600057.2602834)], are known to satisfy some highly desired properties.
We then show applications of this framework in the context of supply chains. We show how existing mechanisms can be implemented as multilateral deferred acceptance mechanisms, and thus exhibit nice practical properties (as group strategy-proofness and equivalence to clock auctions). We use the general framework to design a novel mechanism that improves upon previous mechanisms in terms of social welfare. Our mechanism manages to avoid “trade reduction” in some scenarios, while maintaining the incentive and budget-balance properties.
For the entire collection see [Zbl 1326.68026].
MSC:
91B26 Auctions, bargaining, bidding and selling, and other market models
90B05 Inventory, storage, reservoirs
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