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Simultaneous Ascending Auctions with Package Bidding

Peter Cramton (), John McMillan, Paul Milgrom (), Bradley Miller (), Bridger Mitchell (), Daniel Vincent and Robert Wilson ()

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

Abstract: An effective package bidding mechanism addresses three problems: the exposure problem (the risks a bidder faces in trying to construct an efficiently large combination of licenses), the free-rider problem (the difficulties small bidders have in beating those who bid for larger packages of licenses), and the computational complexity problem (which arises from the fact that the number of possible combinations of licenses is much larger than the number of licenses). Package bidding offers the possibility of an improvement over individual-license bidding only when there are strong complementarities and the pattern of those complementarities varies across bidders. Package bidding works satisfactorily only when the auction rules have been carefully designed to manage all three problems.

Keywords: Auctions; Spectrum Auctions; Multiple-Round Auctions; Efficiency (search for similar items in EconPapers)
JEL-codes: D44 D61 L96 (search for similar items in EconPapers)
Date: 1998-03
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