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The Clock-Proxy Auction: A Practical Combinatorial Auction Design

Lawrence M. Ausubel (), Peter Cramton () and Paul Milgrom ()
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Lawrence M. Ausubel: Economics Department, University of Maryland, http://www.econ.umd.edu

Papers of Peter Cramton from University of Maryland, Department of Economics - Peter Cramton

Abstract: We propose the clock-proxy auction as a practical means for auctioning many related items. A clock auction phase is followed by a last-and-final proxy round. The approach combines the simple and transparent price discovery of the clock auction with the efficiency of the proxy auction. Linear pricing is maintained as long as possible, but then is abandoned in the proxy round to improve efficiency and enhance seller revenues. The approach has many advantages over the simultaneous ascending auction. In particular, the clock-proxy auction has no exposure problem, eliminates incentives for demand reduction, and prevents most collusive bidding strategies.

Keywords: Auctions; Combinatorial Auctions; Market Design; Clock Auctions (search for similar items in EconPapers)
JEL-codes: D44 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2004, Revised 2004
New Economics Papers: this item is included in nep-com
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Published in Peter Cramton, Yoav Shoham, and Richard Steinberg, eds., Combinatorial Auctions, Cambridge, MA: MIT Press, chapter 5, 2006.

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Working Paper: The Clock-Proxy Auction: A Practical Combinatorial Auction Design (2004) Downloads
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