4,464 research outputs found
Improved Revenue Bounds for Posted-Price and Second-Price Mechanisms
We study revenue maximization through sequential posted-price (SPP)
mechanisms in single-dimensional settings with buyers and independent but
not necessarily identical value distributions. We construct the SPP mechanisms
by considering the best of two simple pricing rules: one that imitates the
revenue optimal mchanism, namely the Myersonian mechanism, via the taxation
principle and the other that posts a uniform price. Our pricing rules are
rather generalizable and yield the first improvement over long-established
approximation factors in several settings. We design factor-revealing
mathematical programs that crisply capture the approximation factor of our SPP
mechanism. In the single-unit setting, our SPP mechanism yields a better
approximation factor than the state of the art prior to our work (Azar,
Chiplunkar & Kaplan, 2018). In the multi-unit setting, our SPP mechanism yields
the first improved approximation factor over the state of the art after over
nine years (Yan, 2011 and Chakraborty et al., 2010). Our results on SPP
mechanisms immediately imply improved performance guarantees for the equivalent
free-order prophet inequality problem. In the position auction setting, our SPP
mechanism yields the first higher-than approximation factor. In eager
second-price (ESP) auctions, our two simple pricing rules lead to the first
improved approximation factor that is strictly greater than what is obtained by
the SPP mechanism in the single-unit setting.Comment: Accepted to Operations Researc
Budget Constrained Auctions with Heterogeneous Items
In this paper, we present the first approximation algorithms for the problem
of designing revenue optimal Bayesian incentive compatible auctions when there
are multiple (heterogeneous) items and when bidders can have arbitrary demand
and budget constraints. Our mechanisms are surprisingly simple: We show that a
sequential all-pay mechanism is a 4 approximation to the revenue of the optimal
ex-interim truthful mechanism with discrete correlated type space for each
bidder. We also show that a sequential posted price mechanism is a O(1)
approximation to the revenue of the optimal ex-post truthful mechanism when the
type space of each bidder is a product distribution that satisfies the standard
hazard rate condition. We further show a logarithmic approximation when the
hazard rate condition is removed, and complete the picture by showing that
achieving a sub-logarithmic approximation, even for regular distributions and
one bidder, requires pricing bundles of items. Our results are based on
formulating novel LP relaxations for these problems, and developing generic
rounding schemes from first principles. We believe this approach will be useful
in other Bayesian mechanism design contexts.Comment: Final version accepted to STOC '10. Incorporates significant reviewer
comment
Sequential Posted Price Mechanisms with Correlated Valuations
We study the revenue performance of sequential posted price mechanisms and
some natural extensions, for a general setting where the valuations of the
buyers are drawn from a correlated distribution. Sequential posted price
mechanisms are conceptually simple mechanisms that work by proposing a
take-it-or-leave-it offer to each buyer. We apply sequential posted price
mechanisms to single-parameter multi-unit settings in which each buyer demands
only one item and the mechanism can assign the service to at most k of the
buyers. For standard sequential posted price mechanisms, we prove that with the
valuation distribution having finite support, no sequential posted price
mechanism can extract a constant fraction of the optimal expected revenue, even
with unlimited supply. We extend this result to the the case of a continuous
valuation distribution when various standard assumptions hold simultaneously.
In fact, it turns out that the best fraction of the optimal revenue that is
extractable by a sequential posted price mechanism is proportional to ratio of
the highest and lowest possible valuation. We prove that for two simple
generalizations of these mechanisms, a better revenue performance can be
achieved: if the sequential posted price mechanism has for each buyer the
option of either proposing an offer or asking the buyer for its valuation, then
a Omega(1/max{1,d}) fraction of the optimal revenue can be extracted, where d
denotes the degree of dependence of the valuations, ranging from complete
independence (d=0) to arbitrary dependence (d=n-1). Moreover, when we
generalize the sequential posted price mechanisms further, such that the
mechanism has the ability to make a take-it-or-leave-it offer to the i-th buyer
that depends on the valuations of all buyers except i's, we prove that a
constant fraction (2-sqrt{e})/4~0.088 of the optimal revenue can be always be
extracted.Comment: 29 pages, To appear in WINE 201
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