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# Revenue monotonicity in combinatorial auctions

Rastegari, Baharak, Condon, Anne and Leyton-Brown, Kevin (2007) Revenue monotonicity in combinatorial auctions. Artificial Intelligence, 175 (2), 45-47.

Record type: Article

## Abstract

In recent work [Rastegari et al. 2007a; 2007b] we study revenue properties of combinatorial auctions. Consider a well-known drawback of the famous VCG mechanism: a seller’s revenue can go down when bidders are added to an auction, contrary to the intuition that having more bidders should increase competition. Following an example due to Ausubel and Milgrom [2006], consider an auction with three bidders and two goods for sale. Suppose that bidder 2 wants both goods for the price of $2 billion whereas bidder 1 and bidder 3 are willing to pay$2 billion for the first and the second good respectively (see Figure 1). The VCG mechanism awards the goods to bidders 1 and 3 for the price of zero, yielding the seller zero revenue. However, in the absence of either bidder 1 or bidder 3, the revenue of the auction would be \$2 billion.

We say that an auction mechanism is revenue monotonic if the seller’s revenue is …

Published date: 1 December 2007

## Identifiers

Local EPrints ID: 426396
URI: http://eprints.soton.ac.uk/id/eprint/426396
ISSN: 0004-3702
PURE UUID: 064f06a2-c0d5-492b-9fa7-30a0974504c5
ORCID for Baharak Rastegari: orcid.org/0000-0002-0985-573X

## Catalogue record

Date deposited: 27 Nov 2018 17:30

## Contributors

Author: Baharak Rastegari
Author: Anne Condon
Author: Kevin Leyton-Brown