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Multi-Unit Auctions: A Comparison of Static and Dynamic Mechanisms

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Abstract

We compare, experimentally, the Vickrey auction and an ascending-price auction recently introduced by Ausubel (1997). We evaluate the relative performance of both auctions in terms of efficiency and revenue in multi-unit environments where valuations either have a common-value component or are private information. We find that the Ausubel auction is less prone to overbidding and may yield higher revenue than the Vickrey auction. The gain in revenue seems to be coupled with a loss of efficiency.

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  • Alejandro Manelli & Martin Sefton & Benjamin Wilner, "undated". "Multi-Unit Auctions: A Comparison of Static and Dynamic Mechanisms," Working Papers 2132867, Department of Economics, W. P. Carey School of Business, Arizona State University.
    • Handle: RePEc:asu:wpaper:2132867
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    2. Kagel, John H. & Levin, Dan, 2009. "Implementing efficient multi-object auction institutions: An experimental study of the performance of boundedly rational agents," Games and Economic Behavior, Elsevier, vol. 66(1), pages 221-237, May.
    3. Dirk Engelmann & Veronika Grimm, 2003. "Bidding Behavior in Multi-Unit Auctions - An Experimental Investigation and some Theoretical Insights," CERGE-EI Working Papers wp210, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    4. Takehito Masuda & Ryo Mikami & Toyotaka Sakai & Shigehiro Serizawa & Takuma Wakayama, 2023. "Correction to: The net effect of advice on strategy-proof mechanisms: an experiment for the Vickrey auction," Experimental Economics, Springer;Economic Science Association, vol. 26(1), pages 249-250, March.
    5. Dan Levin, 2005. "Demand Reduction in Multi-Unit Auctions: Evidence from a Sportscard Field Experiment: Comment," American Economic Review, American Economic Association, vol. 95(1), pages 467-471, March.
    6. Ahlberg, Joakim, 2012. "Multi-unit common value auctions: an experimental comparison between the static and the dynamic uniform auction," Working papers in Transport Economics 2012:24, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    7. Ahlberg , Joakim, 2012. "Multi-unit common value auctions: a laboratory experiment with three sealed-bid mechanisms," Working papers in Transport Economics 2012:23, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    8. Anabela Botelho & Eduarda Fernandes & Lígia Costa Pinto, 2010. "An experimental analysis of grandfathering vs dynamic auctioning in the EU ETS," NIMA Working Papers 39, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
    9. Takehito Masuda & Toyotaka Sakai & Shigehiro Serizawa & Takuma Wakayama, 2019. "A Strategy-Proof Mechanism Should Be Announced to Be Strategy-Proof: An Experiment for the Vickrey Auction," ISER Discussion Paper 1048, Institute of Social and Economic Research, The University of Osaka.
    10. Sherstyuk, Katerina, 2008. "Some Results on Anti-Competitive Behavior in Multi-Unit Ascending Price Auctions," Handbook of Experimental Economics Results, in: Charles R. Plott & Vernon L. Smith (ed.), Handbook of Experimental Economics Results, edition 1, volume 1, chapter 23, pages 185-198, Elsevier.
    11. Stefan Weishaar, 2007. "CO 2 emission allowance allocation mechanisms, allocative efficiency and the environment: a static and dynamic perspective," European Journal of Law and Economics, Springer, vol. 24(1), pages 29-70, August.
    12. Regina Betz & Stefan Seifert & Peter Cramton & Suzi Kerr, 2010. "Auctioning greenhouse gas emissions permits in Australia ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(2), pages 219-238, April.
    13. Abbink, Klaus & Brandts, Jordi & Pezanis-Christou, Paul, 2006. "Auctions for government securities: A laboratory comparison of uniform, discriminatory and Spanish designs," Journal of Economic Behavior & Organization, Elsevier, vol. 61(2), pages 284-303, October.
    14. Anthony M. Kwasnica & Katerina Sherstyuk, 2013. "Multiunit Auctions," Journal of Economic Surveys, Wiley Blackwell, vol. 27(3), pages 461-490, July.
    15. Lawrence M. Ausubel & Peter Cramton & Wynne P. Jones, 2012. "System and Method for an Auction of Multiple Types of Items," Papers of Peter Cramton 11acjam, University of Maryland, Department of Economics - Peter Cramton, revised 2012.
    16. Eaves, James & Williams, Jeffrey & Power, Gabriel J., 2016. "Do traders strategically time their pledges during real-world Walrasian auctions?," Journal of Banking & Finance, Elsevier, vol. 71(C), pages 109-118.
    17. Anabela Botelho & Lígia Costa Pinto & Eduarda Fernandes, 2013. "More on the dynamic Vickrey mechanism for multi-unit auctions: an experimental study on the emission permits initial auction," NIMA Working Papers 53, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
    18. Lawrence M. Ausubel & Peter Cramton & Paul Milgrom, 2012. "System and Method for a Hybrid Clock and Proxy Auction," Papers of Peter Cramton 12acmhc, University of Maryland, Department of Economics - Peter Cramton, revised 2012.
    19. Talebiyan, Hesam & Dueñas-Osorio, Leonardo, 2023. "Auctions for resource allocation and decentralized restoration of interdependent networks," Reliability Engineering and System Safety, Elsevier, vol. 237(C).

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