Credible, Truthful, and Two-Round (Optimal) Auctions via Cryptographic Commitments

Matheus V. X. Ferreira and S. Matthew Weinberg

Papers from arXiv.org

Abstract: We consider the sale of a single item to multiple buyers by a revenue-maximizing seller. Recent work of Akbarpour and Li formalizes \emph{credibility} as an auction desideratum, and prove that the only optimal, credible, strategyproof auction is the ascending price auction with reserves (Akbarpour and Li, 2019). In contrast, when buyers' valuations are MHR, we show that the mild additional assumption of a cryptographically secure commitment scheme suffices for a simple \emph{two-round} auction which is optimal, strategyproof, and credible (even when the number of bidders is only known by the auctioneer). We extend our analysis to the case when buyer valuations are $\alpha$-strongly regular for any $\alpha > 0$, up to arbitrary $\varepsilon$ in credibility. Interestingly, we also prove that this construction cannot be extended to regular distributions, nor can the $\varepsilon$ be removed with multiple bidders.

Date: 2020-04, Revised 2020-05
New Economics Papers: this item is included in nep-des and nep-mic
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Citations: View citations in EconPapers (6)

Published in EC '20: Proceedings of the 21st ACM Conference on Economics and Computation, 2020, 683-712

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