IDEAS home Printed from https://ideas.repec.org/p/yor/yorken/25-02.html

A Universally Efficient Dynamic Auction for All Unimodular Demand Types

Author

Listed:
  • Satoru Fujishige
  • Zaifu Yang

Abstract

We propose a novel strategy-proof dynamic auction for efficiently allocating heterogeneous indivisible commodities. The auction applies to all unimodular demand types of Baldwin and Klemperer’s necessary and sufficient condition for the existence of competitive equilibrium which accommodate a variety of complements, substitutes, gross substitutes and complements, and any other kinds. Although bidders are not assumed to be price-takers so they can act strategically, this auction induces bidders to bid truthfully, yielding efficient outcomes. Sincere bidding is shown to be an ex post perfect Nash equilibrium of the auction. The trading rules are simple, detail-free, privacy-preserving, error-tolerant, and independent of any probability distribution assumption.

Suggested Citation

  • Satoru Fujishige & Zaifu Yang, 2025. "A Universally Efficient Dynamic Auction for All Unimodular Demand Types," Discussion Papers 25/02, Department of Economics, University of York.
    • Handle: RePEc:yor:yorken:25/02
    as

    Download full text from publisher

    File URL: https://www.york.ac.uk/media/economics/documents/discussionpapers/2025/2502.pdf
    File Function: Main text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Green, Jerry & Laffont, Jean-Jacques, 1977. "Characterization of Satisfactory Mechanisms for the Revelation of Preferences for Public Goods," Econometrica, Econometric Society, vol. 45(2), pages 427-438, March.
    2. Ausubel Lawrence M & Milgrom Paul R, 2002. "Ascending Auctions with Package Bidding," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 1(1), pages 1-44, August.
    3. Levin, Jonathan, 1997. "An Optimal Auction for Complements," Games and Economic Behavior, Elsevier, vol. 18(2), pages 176-192, February.
    4. Paul Klemperer, 2004. "Auctions: Theory and Practice," Online economics textbooks, SUNY-Oswego, Department of Economics, number auction1, December.
    5. Danilov, Vladimir & Koshevoy, Gleb & Murota, Kazuo, 2001. "Discrete convexity and equilibria in economies with indivisible goods and money," Mathematical Social Sciences, Elsevier, vol. 41(3), pages 251-273, May.
    6. Lawrence M. Ausubel, 2004. "An Efficient Ascending-Bid Auction for Multiple Objects," American Economic Review, American Economic Association, vol. 94(5), pages 1452-1475, December.
    7. Paul Klemperer, 2004. "Survey of Auction Theory, from Auctions: Theory and Practice," Introductory Chapters, in: Auctions: Theory and Practice, Princeton University Press.
    8. Ning Sun & Zaifu Yang, 2014. "An Efficient and Incentive Compatible Dynamic Auction for Multiple Complements," Journal of Political Economy, University of Chicago Press, vol. 122(2), pages 422-466.
    9. Gul, Faruk & Stacchetti, Ennio, 2000. "The English Auction with Differentiated Commodities," Journal of Economic Theory, Elsevier, vol. 92(1), pages 66-95, May.
    10. Ning Sun & Zaifu Yang, 2009. "A Double-Track Adjustment Process for Discrete Markets With Substitutes and Complements," Econometrica, Econometric Society, vol. 77(3), pages 933-952, May.
    11. Milgrom,Paul, 2004. "Putting Auction Theory to Work," Cambridge Books, Cambridge University Press, number 9780521536721, January.
    12. Motty Perry & Philip J. Reny, 2002. "An Efficient Auction," Econometrica, Econometric Society, vol. 70(3), pages 1199-1212, May.
    13. Milgrom, Paul & Strulovici, Bruno, 2009. "Substitute goods, auctions, and equilibrium," Journal of Economic Theory, Elsevier, vol. 144(1), pages 212-247, January.
    14. Motty Perry & Philip J. Reny, 2005. "An Efficient Multi-Unit Ascending Auction," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 72(2), pages 567-592.
    15. Paul Klemperer, 2004. "Auctions: Theory and Practice," Online economics textbooks, SUNY-Oswego, Department of Economics, number auction1.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Satoru Fujishige & Zaifu Yang, 2020. "A Universal Dynamic Auction for Unimodular Demand Types: An Efficient Auction Design for Various Kinds of Indivisible Commodities," Discussion Papers 20/08, Department of Economics, University of York.
    2. Satoru Fujishige & Zaifu Yang, 2017. "On a spontaneous decentralized market process," The Journal of Mechanism and Institution Design, Society for the Promotion of Mechanism and Institution Design, University of York, vol. 2(1), pages 1-37, December.
    3. Zaifu Yang & Jingsheng Yu, 2024. "An Efficient and General Ascending Menu Auction under Budget Constraints," The Journal of Mechanism and Institution Design, Society for the Promotion of Mechanism and Institution Design, University of York, vol. 9(1), pages 105-130, December.
    4. A. Talman & Zaifu Yang, 2015. "An efficient multi-item dynamic auction with budget constrained bidders," International Journal of Game Theory, Springer;Game Theory Society, vol. 44(3), pages 769-784, August.
    5. Gerard van der Laan & Zaifu Yang, 2016. "An ascending multi-item auction with financially constrained bidders," The Journal of Mechanism and Institution Design, Society for the Promotion of Mechanism and Institution Design, University of York, vol. 1(1), pages 109-149, December.
    6. Song, Siqi & Zhang, Chi, 2025. "A globally convergent alternating one-track auction for gross substitutes and complements," Journal of Mathematical Economics, Elsevier, vol. 118(C).
    7. Li, Yunan, 2017. "Approximation in mechanism design with interdependent values," Games and Economic Behavior, Elsevier, vol. 103(C), pages 225-253.
    8. Satoru Fujishige & Zaifu Yang, 2015. "Decentralised Random Competitive Dynamic Market Processes," Discussion Papers 15/27, Department of Economics, University of York.
    9. Kazuo Murota, 2016. "Discrete convex analysis: A tool for economics and game theory," The Journal of Mechanism and Institution Design, Society for the Promotion of Mechanism and Institution Design, University of York, vol. 1(1), pages 151-273, December.
    10. Ning Sun & Zaifu Yang, 2014. "An Efficient and Incentive Compatible Dynamic Auction for Multiple Complements," Journal of Political Economy, University of Chicago Press, vol. 122(2), pages 422-466.
    11. Zhou, Yu & Serizawa, Shigehiro, 2023. "Multi-object auction design beyond quasi-linearity: Leading examples," Games and Economic Behavior, Elsevier, vol. 140(C), pages 210-228.
    12. Eickhoff, Katharina & Neuwohner, Meike & Peis, Britta & Rieken, Niklas & Vargas Koch, Laura & Végh, Lázló A., 2025. "Faster dynamic auctions via polymatroid sum," LSE Research Online Documents on Economics 127980, London School of Economics and Political Science, LSE Library.
    13. Kaplan, Todd R. & Zamir, Shmuel, 2015. "Advances in Auctions," Handbook of Game Theory with Economic Applications,, Elsevier.
    14. Zaifu Yang & Jingsheng Yu, 2018. "Efficient Ascending Menu Auctions with Budget Constrained Bidders," Discussion Papers 18/09, Department of Economics, University of York.
    15. Peter Cramton, 2013. "Spectrum Auction Design," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 42(2), pages 161-190, March.
    16. Sun, Ning & Yang, Zaifu, 2016. "An Efficient and Strategy-Proof Double-Track Auction for Substitutes and Complements," Center for Mathematical Economics Working Papers 523, Center for Mathematical Economics, Bielefeld University.
    17. Akiyoshi Shioura & Zaifu Yang, 2013. "Equilibrium, Auction, Multiple Substitutes and Complements," Discussion Papers 13/17, Department of Economics, University of York.
    18. Alexander Teytelboym & Shengwu Li & Scott Duke Kominers & Mohammad Akbarpour & Piotr Dworczak, 2021. "Discovering Auctions: Contributions of Paul Milgrom and Robert Wilson," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(3), pages 709-750, July.
    19. Ning Sun & Zaifu Yang, 2008. "A Double-Track Auction for Substitutes and Complements," KIER Working Papers 656, Kyoto University, Institute of Economic Research.
    20. Jagadeesan, Ravi & Kominers, Scott Duke & Rheingans-Yoo, Ross, 2018. "Strategy-proofness of worker-optimal matching with continuously transferable utility," Games and Economic Behavior, Elsevier, vol. 108(C), pages 287-294.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:yor:yorken:25/02. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Paul Hodgson (email available below). General contact details of provider: https://edirc.repec.org/data/deyoruk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.