Modeling competitive bidding: a critical essay
Management Science
AAAI '98/IAAI '98 Proceedings of the fifteenth national/tenth conference on Artificial intelligence/Innovative applications of artificial intelligence
The Future of Emarkets: Multi-Dimensional Market Mechanisms
The Future of Emarkets: Multi-Dimensional Market Mechanisms
Handbook of Mathematical Functions, With Formulas, Graphs, and Mathematical Tables,
Handbook of Mathematical Functions, With Formulas, Graphs, and Mathematical Tables,
A unified framework for multiple criteria auction mechanisms
Web Intelligence and Agent Systems
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Electronic auction markets collect large amounts of auction field data. This enables a structural estimation of the bid distributions and the possibility to derive optimal reservation prices. In this paper we propose a new approach to setting reservation prices. In contrast to traditional auction theory we use the buyer's risk statement for getting a winning bid as a key criterion to set an optimal reservation price. The reservation price for a given probability can then be derived from the distribution function of the observed drop-out bids. In order to get an accurate model of this function, we propose a nonparametric technique based on kernel distribution function estimators and the use of order statistics. We improve our estimator by additional information, which can be observed about bidders and qualitative differences of goods in past auctions rounds (e.g. different delivery times). This makes the technique applicable to RFQs and multi-attribute auctions, with qualitatively differentiated offers.