Truthful randomized mechanisms for combinatorial auctions

  • Authors:
  • Shahar Dobzinski;Noam Nisan;Michael Schapira

  • Affiliations:
  • The Hebrew University of Jerusalem, Israel;The Hebrew University of Jerusalem, Israel;The Hebrew University of Jerusalem, Israel

  • Venue:
  • Proceedings of the thirty-eighth annual ACM symposium on Theory of computing
  • Year:
  • 2006

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Abstract

We design two computationally-efficient incentive-compatible mechanisms for combinatorial auctions with general bidder preferences. Both mechanisms are randomized, and are incentive-compatible in the universal sense. This is in contrast to recent previous work that only addresses the weaker notion of incentive compatibility in expectation. The first mechanism obtains an O(√m)-approximation of the optimal social welfare for arbitrary bidder valuations -- this is the best approximation possible in polynomial time. The second one obtains an O(log2 m)-approximation for a subclass of bidder valuations that includes all submodular bidders. This improves over the best previously obtained incentive-compatible mechanism for this class which only provides an O(√ m)-approximation.