Combinatorial Scoring Auctions
This paper is concerned with a combinatorial, multi-attribute procurement mechanism called combinatorial scoring auction. In the setting that we analyze, private information of the suppliers is multi-dimensional. The buyer wants to procure several items at once. Subsets of these items are characterized by a price as well as by a number of non-monetary attributes called quality (e.g. completion time). The suppliers submit offers specifying prices and quality levels for these subsets. These offers are evaluated according to a quasilinear scoring rule. Based on the resulting scores suppliers win contracts for the delivery of certain items. Such a contract only specifies the set of items a supplier has to deliver and a score that he has to meet. The decision about the specific price-quality combination yielding this contracted score is at the discretion of the supplier who aims at optimizing his own profit. We analyze the equilibria in such auctions and show the link between combinatorial scoring auctions and combinatorial price-only auctions. We demonstrate how this link can be used to employ preexisting knowledge about the equilibrium behavior in regular price-only auctions in the strategic analysis of combinatorial scoring auctions. Our results are the multi-item extension to the results of Asker and Cantillon (2007).
|Date of creation:||2007|
|Date of revision:|
|Contact details of provider:|| Postal: P.O. Box 616, 6200 MD Maastricht|
Phone: +31 (0)43 38 83 830
Web page: http://www.maastrichtuniversity.nl/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Krishna, Vijay & Maenner, Eliot, 2001. "Convex Potentials with an Application to Mechanism Design," Econometrica, Econometric Society, vol. 69(4), pages 1113-19, July.
- Edward Clarke, 1971. "Multipart pricing of public goods," Public Choice, Springer, vol. 11(1), pages 17-33, September.
- Che, Y.K., 1991.
"Design Competition through Multidimensional Auctions,"
9123, Wisconsin Madison - Social Systems.
- Yeon-Koo Che, 1993. "Design Competition through Multidimensional Auctions," RAND Journal of Economics, The RAND Corporation, vol. 24(4), pages 668-680, Winter.
- Groves, Theodore, 1973. "Incentives in Teams," Econometrica, Econometric Society, vol. 41(4), pages 617-31, July.
- Holzman, Ron & Kfir-Dahav, Noa & Monderer, Dov & Tennenholtz, Moshe, 2004. "Bundling equilibrium in combinatorial auctions," Games and Economic Behavior, Elsevier, vol. 47(1), pages 104-123, April.
- Bichler, Martin & Kalagnanam, Jayant, 2005. "Configurable offers and winner determination in multi-attribute auctions," European Journal of Operational Research, Elsevier, vol. 160(2), pages 380-394, January.
- Fernando Branco, 1997. "The Design of Multidimensional Auctions," RAND Journal of Economics, The RAND Corporation, vol. 28(1), pages 63-81, Spring.
- Richard V. Burkhauser & Paul J. Gertler, 1995. "Introduction," Journal of Human Resources, University of Wisconsin Press, vol. 30, pages s1-s6.
When requesting a correction, please mention this item's handle: RePEc:unm:umamet:2007020. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Charles Bollen)
If references are entirely missing, you can add them using this form.