A dominant strategy, double clock auction with estimation-based tatonnement

Simon Loertscher and Claudio Mezzetti

Theoretical Economics, 2021, vol. 16, issue 3

Abstract: The price mechanism is fundamental to economics but difficult to reconcile with incentive compatibility. We introduce a double clock auction for a homogeneous good market with multi-dimensional private information and multi-unit traders that is deficit-free, ex post individually rational, constrained efficient, and makes sincere bidding a dominant strategy equilibrium. Under a weak dependence and an identifiability condition, our double clock auction is also asymptotically efficient. Asymptotic efficiency is achieved by estimating demand and supply using information from the bids of traders that have dropped out and following a tatonnement process that adjusts the clock prices based on the estimates.

Keywords: Deficit free; dominant strategy mechanisms; double clock auctions; vcg mechanism (search for similar items in EconPapers)
JEL-codes: C72 D44 D47 D82 (search for similar items in EconPapers)
Date: 2021-07-21
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://econtheory.org/ojs/index.php/te/article/viewFile/20210943/31445/900 (application/pdf)

Related works:
Working Paper: A Dominant Strategy, Double Clock Auction with Estimation-Based Tatonnement (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:the:publsh:3311

Access Statistics for this article

Theoretical Economics is currently edited by Simon Board, Todd D. Sarver, Juuso Toikka, Rakesh Vohra, Pierre-Olivier Weill

More articles in Theoretical Economics from Econometric Society
Bibliographic data for series maintained by Martin J. Osborne (martin.osborne@utoronto.ca).