A Formal Separation Between Strategic and Nonstrategic Behavior

It is common in multiagent systems to make a distinction between "strategic" behavior and other forms of intentional but "nonstrategic" behavior: typically, that strategic agents model other agents while nonstrategic agents do not. However, a crisp boundary between these concepts has proven elusive. This problem is pervasive throughout the game theoretic literature on bounded rationality and particularly critical in parts of the behavioral game theory literature that make an explicit distinction between the behavior of "nonstrategic" level-0 agents and "strategic" higher-level agents (e.g., the level-k and cognitive hierarchy models). Overall, work discussing bounded rationality rarely gives clear guidance on how the rationality of nonstrategic agents must be bounded, instead typically just singling out specific decision rules and informally asserting them to be nonstrategic (e.g., truthfully revealing private information; randomizing uniformly). In this work, we propose a new, formal characterization of nonstrategic behavior. Our main contribution is to show that it satisfies two properties: (1) it is general enough to capture all purportedly "nonstrategic" decision rules of which we are aware in the behavioral game theory literature; (2) behavior that obeys our characterization is distinct from strategic behavior in a precise sense

Bundling of Information Goods - Past, Present and Future

Bundling of information goods (such as software and digitized music or TV) is omnipresent in today’s business-to-consumer environment. However, a surprisingly small number of articles address this issue within the information systems science (ISS) literature. By conducting a thorough literature review on the subject, this article shows that a lion’s share of the most important work on information technology product bundling is published outside the ISS arena. On the basis of the literature review, eight future research directions are presented

Ascending Combinatorial Auctions with Risk Averse Bidders

Ascending combinatorial auctions are being used in an increasing number of spectrum sales worldwide, as well as in other multi-item markets in procurement and logistics. Much research has focused on pricing and payment rules in such ascending auctions. However, recent game-theoretical research has shown that such auctions can even lead to inefficient perfect Bayesian equilibria with risk-neutral bidders. There is a fundamental free-rider problem without a simple solution, raising the question whether ascending combinatorial auctions can be expected to be efficient in the field. Risk aversion is arguably a significant driver of bidding behavior in high-stakes auctions. We analyze the impact of risk aversion on equilibrium bidding strategies and efficiency in a threshold problem with one global and several local bidders. Due to the underlying free-rider problem, the impact of risk-aversion on equilibrium bidding strategies of local bidders is not obvious. We characterize the necessary and sufficient conditions for the perfect Bayesian equilibria of the ascending auction mechanism to have the local bidders to drop at the reserve price. Interestingly, in spite of the free-riding opportunities of local bidders, risk-aversion reduces the scope of the non-bidding equilibrium. The results help explain the high efficiency of ascending combinatorial auctions observed in the lab. © 2015, Springer Science+Business Media Dordrecht

Multiple-round timber auction design and simulation

This paper presents a multiple-round timber auction simulation, developed in order to study various configurations of auction design. In this study, simultaneous sequential timber auctions are modelled and analysed using agent-based simulation technology. As there are many individual items in the auction to be sold, the auction designer defines several rounds that are sequential at pre-defined intervals. At each round, the auction designer announces several simultaneous auctions. Since bidders are offered different items at each round, a mathematical linear programing model for selecting the best set of items to bid for is presented. Different bidding patterns are simulated and compared in various setup configurations. The most advanced of these strategies are adaptive and use agent-learning capability. The comparisons include the success rate of winning the auction and the winning price per m3. This study suggests an efficient bidding pattern for bidders to bid in order to achieve to their goal and increase their profit. Similarly, in order to increase profit, the auctioneer (i.e. the government) needs to control several auction parameters including the number of auctions per year, the lot size, the auction periodicity, and the number of bidders. This study also suggests parameters configurations that to maximise revenue for the auctioneer

Timber Auction Simulation and Design

RÉSUMÉ : La commercialisation sous forme de vente aux enchères publique du bois provenant de forêts, comme dans la province de Québec, est une tâche difficile. En effet, il est crucial de déterminer les prix représentatifs de la vente aux enchères de bois dans toutes les régions du Québec afin de permettre à plus d'acheteurs potentiels d'accéder au marché. De même, il est également important de concevoir un système d'enchères qui est bénéfique pour les entreprises forestières et les gens de Québec. La vente unitaire, dans lequel les utilisateurs de bois autorisés à soumissionner pour le lot entier, est actuellement appliquée comme une méthode de vente aux enchères. Dans ce système de vente aux enchères du bois, les utilisateurs de bois sont responsables de la récolte de la totalité du lot et pour la revente espèces ligneuses indésirables à d'autres utilisateurs. Dans ce projet, nous analysons d'abord différentes configurations d’enchères à rondes multiples de type premier prix sous pli scellé, tel que proposé par le ministère des Ressources naturelles du Québec, afin de mieux comprendre la dynamique et les facteurs dominants de la réussite de ce type de mécanisme d'allocation de bois. Pour cela, nous utilisons la simulation à base d'agents pour modéliser et simuler des ventes aux enchères, en proposant notamment des comportements de soumissionnaires réalistes, incluant des stratégies d'adaptation et d'apprentissage, qui ont été simulées et comparées dans diverses configurations. Les comparaisons ont été menées en mesurant notamment le taux de succès de gagner l'enchère et le prix unitaire remporté en $/m3. Cette étude suggère également des configurations de paramètres permettant maximiser les recettes pour le commissaire-priseur. À l’étape suivante de la recherche, cette thèse présente la simulation de la vente de plusieurs sortes de bois rond en utilisant une méthode d’enchères combinatoires. Dans ce processus de vente, les soumissionnaires peuvent avoir besoin d’une combinaison des produits. En utilisant l'approche par simulation, les résultats montrent que les revenus générés par enchère combinatoire peuvent être plus élevés que le revenu de l’enchère unitaire. Afin d'effectuer une analyse de sensibilité, les expériences sont répétées et testés avec diverses combinaisons de quatre paramètres de configuration. Les résultats de l'analyse permettent d’évaluer dans quel contexte l’enchère combinatoire peut faire mieux que l’enchère unitaire, et cela dans différents marchés. Enfin, cette thèse présente un système d'enchères combinatoires qui alloue le bois aux soumissionnaires afin d'améliorer la coordination des dépendances entre les soumissionnaires retenus dans les zones forestières mixtes (c’est à dire avec plusieurs types de produits et utilisateurs potentiels). Pour supporter la coordination des opérations et améliorer la fraicheur du bois, nous proposons une vente aux enchères combinatoire, qui permet aux soumissionnaires d’ajuster la valeur des offres en fonction du temps, via une sorte de calendriers. Cette enchère combinatoire permet ainsi au commissaire-priseur de trouver les meilleures combinaisons de soumissions gagnantes maximisant ainsi les préférences temporelles des soumissionnaires. Pour cela, nous définissons un nouveau problème de détermination du vainqueur (WDP) qui utilise ces fonctions de valeur. Afin de comparer l’impact de diverses préférences temporelles, une analyse de sensibilité est menée. Mots-clés: enchères du bois, enchères séquentielles, la stratégie d'apprentissage, systèmes multi-agents, l'affectation enchères combinatoire, la coordination, la fraicheur du bois, et de problèmes de détermination du vainqueur.----------ABSTRACT : The marketing of wood obtained from forests in public auction, such as in the province of Québec, is a challenging task. Indeed, it is crucial to determine representative prices of the wood auction in all regions of Quebec in order to allow more potential buyers to access the market. Similarly, it is also important to design an auction system that is beneficial for forest companies and the people of Québec. Single-unit auction, in which timber users allowed to bid on the entire lot, is currently applied as a method of auction. In this timber auction system, timber users (i.e., winners) are responsible for harvesting the entire lot and for reselling unwanted timber species to other users. In this project, we first analyze various configurations of the multiple-round first-price sealed-bid auction of wood as proposed by the Québec Ministry of Natural Resources to better understand the dynamics and the dominant factors of success of this type of wood allocation mechanism. To do so, we use agent-based simulation to model and simulate auctions with realistic bidders’ behavior. Different bidding patterns including adaptive and learning strategies are then simulated and compared in various setup configurations. The comparisons have been conducted on the success rate of winning the auction and the winning price per m3. This study also suggests parameter configurations to maximize revenue for the auctioneer. In the next step of research, in the last part, this thesis presents the simulation of multiple-round timber combinatorial auction as the bidders may need variety of species and the size of timber companies may be different. Using simulation approach, the results shows the revenue generated by combinatorial auction can be higher than the revenue of a single unit auction. In order to do sensitive analysis of the comparison, the experiments are repeated and tested with different setup configuration of four parameters. The results of analysis help to evaluate how combinatorial auction can perform better than single auction in different markets. Finally, we intend to present an auction system, which allocates wood to bidders in order to improve the coordination of the dependencies between winning bidders in mixed forest areas (i.e., wood lots with multiple users). To achieve the coordination of procurement operations and improve the freshness of the wood, we propose an auction, by allowing the value of bids to be expressed as a function of time, via some sort of timetables, and by using a combinatorial auction that will allow the auctioneer to find the best combinations of winning bids. In order to do that, we define a new winner determination problem (WDP) that use these value functions for coordination procurement and delivery operations and wood freshness. In order to compare the proposed time-based combinatorial auction with combinatorial auction a sensitive analysis is conducted. The comparison is done according to bidders’ and seller’s time flexibility. Keywords: timber auction, sequential auction, learning strategy, multi agent system, allocation combinatorial auction, coordination, wood freshness, and winner determination problem

An Economic Framework For Resource Management And Pricing In Wireless Networks With Competitive Service Providers

A paradigm shift from static spectrum allocation to dynamic spectrum access (DSA) is becoming a reality due to the recent advances in cognitive radio, wide band spectrum sensing, and network aware real--time spectrum access. It is believed that DSA will allow wireless service providers (WSPs) the opportunity to dynamically access spectrum bands as and when they need it. Moreover, due to the presence of multiple WSPs in a region, it is anticipated that dynamic service pricing would be offered that will allow the end-users to move from long-term service contracts to more flexible short-term service models. In this research, we develop a unified economic framework to analyze the trading system comprising two components: i) spectrum owner--WSPs interactions with regard to dynamic spectrum allocation, and ii) WSP--end-users interactions with regard to dynamic service pricing. For spectrum owner--WSPs interaction, we investigate various auction mechanisms for finding bidding strategies of WSPs and revenue generated by the spectrum owner. We show that sequential bidding provides better result than the concurrent bidding when WSPs are constrained to at most single unit allocation. On the other hand, when the bidders request for multiple units, (i.e., they are not restricted by allocation constraints) synchronous auction mechanism proves to be beneficial than asynchronous auctions. In this regard, we propose a winner determination sealed-bid knapsack auction mechanism that dynamically allocates spectrum to the WSPs based on their bids. As far as dynamic service pricing is concerned, we use game theory to capture the conflict of interest between WSPs and end--users, both of whom try to maximize their respective net utilities. We deviate from the traditional per--service static pricing towards a more dynamic model where the WSPs might change the price of a service almost on a session by session basis. Users, on the other hand, have the freedom to choose their WSP based on the price offered. It is found that in such a greedy and non-cooperative behavioral game model, it is in the best interest of the WSPs to adhere to a price threshold which is a consequence of a price (Nash) equilibrium. We conducted extensive simulation experiments, the results of which show that the proposed auction model entices WSPs to participate in the auction, makes optimal use of the common spectrum pool, and avoids collusion among WSPs. We also demonstrate how pricing can be used as an effective tool for providing incentives to the WSPs to upgrade their network resources and offer better services