Large Auction Design in Dominance
AbstractThis paper shows a detail-free idea of multi-object large double auction design in general trading environments, where the auctioneer randomly divides agents into two groups, and agents in each group trade at the market-clearing price vector in the other group. With private values, any dominant strategy profile mimics price-taking behavior, and the auctioneer achieves approximate efficiency. With interdependent values, any twice iteratively undominated strategy profile mimics fully revealing rational expectations equilibrium, and the auctioneer approximately achieves ex post efficiency. We need only a very weak common knowledge assumption on rationality.
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Bibliographic InfoPaper provided by Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo in its series CARF F-Series with number CARF-F-007.
Length: 32 pages
Date of creation: Jun 2004
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