Optimal Multiunit Exchange Design

Hitoshi Matsushima

No CARF-F-279, CARF F-Series from Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo

Abstract: We investigate multiunit exchange where a central planner and participants both bring commodities to sell and the central planner plays the role of platform provider.The central planner has restrictions on allocations. We characterize the optimal mechanism concerning his (her) revenue under incentive compatibility and individual rationality in the ex-post term. We introduce modified virtual valuation and show that the optimization problem can be replaced with the maximization of modified virtual valuations. We apply our results to important problems of single-unit demands and position exchanges. We demonstrate a clock auction design that implements the optimal position allocation through dominant strategies

Pages: 37 pages
Date: 2012-05
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Citations: View citations in EconPapers (3)

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Working Paper: Optimal Multiunit Exchange Design (2012)
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