Beyond moulin mechanisms

  • Authors:

  • Aranyak Mehta;Tim Roughgarden;Mukund Sundararajan

  • Affiliations:

  • IBM, Almaden, CA;Stanford University, Stanford, CA;Stanford University, Stanford, CA

  • Venue:
  • Proceedings of the 8th ACM conference on Electronic commerce
  • Year:
  • 2007

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Abstract

The only known general technique for designing truthful, approximatelybudget-balanced cost-sharing mechanisms is due to Moulin. While Moulin mechanisms have been successfully designed for a widerange of applications, recent negative results show that for manyfundamental cost-sharing problems, Moulin mechanisms inevitably sufferfrom poor budget-balance, poor economic efficiency, or both. We propose acyclic mechanisms, a new framework for designingtruthful, approximately budget-balanced cost-sharing mechanisms. Acyclic mechanisms strictly generalize Moulin mechanisms andoffer three important advantages. First, it is easier to design acyclic mechanisms than Moulinmechanisms: many classical primal-dual algorithms naturallyinduce a non-Moulin acyclic mechanism with good performanceguarantees. Second, for several important classes of cost-sharing problems, acyclicmechanisms have exponentially better budget-balance and economicefficiency than Moulin mechanisms.Finally, while Moulin mechanisms have found application primarily in binary demand games, we extend acyclic mechanisms to general demand games, a multi-parameter setting in which each bidder can be allocated one of several levels of service.