Equitable Auctions

Simon Finster, Patrick Loiseau, Simon Mauras, Mathieu Molina and Bary Pradelski

Papers from arXiv.org

Abstract: We initiate the study of how auction design affects the division of surplus among buyers. We propose a parsimonious measure for equity and apply it to the family of standard auctions for homogeneous goods. Our surplus-equitable mechanism is efficient, Bayesian-Nash incentive compatible, and achieves surplus parity among winners ex-post. The uniform-price auction is equity-optimal if and only if buyers have a pure common value. Against intuition, the pay-as-bid auction is not always preferred in terms of equity if buyers have pure private values. In auctions with price mixing between pay-as-bid and uniform prices, we provide prior-free bounds on the equity-preferred pricing rule under a common regularity condition on signals.

Date: 2024-03, Revised 2024-11
New Economics Papers: this item is included in nep-com, nep-cta, nep-des, nep-gth and nep-mic
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