Buyout Decision of Level-k Bidders in Second-price Auctions

2021 ◽  
Author(s):  
Toshihiro Tsuchihashi
Keyword(s):  
Second Price Auctions

scholarly journals Fairness and Efficiency in Online Advertising Mechanisms

Games ◽  
2021 ◽  
Vol 12 (2) ◽  
pp. 36
Author(s):  
Alison Watts
Keyword(s):  
Online Advertising ◽  
Random Assignment ◽  
Unfair Treatment ◽  
Fairness And Efficiency ◽  
Second Price Auctions

Online advertising often involves targeting ads to certain types of consumers where ads are commonly sold by generalized second price auctions. However, such an auction or mechanism could be considered unfair if similar consumers are consistently shown different ads or consistently receive different payoffs. Results show that such ascending bid auctions may result in unfair treatment and additionally that uncertainty regarding an ad’s value can result in inefficiency. An alternative way to assign ads to consumers is presented called the random assignment mechanism. Results show that the random assignment can improve fairness while improving efficiency in some circumstances.

A NOTE ON THE EFFECT OF ASYMMETRY ON REVENUE IN SECOND-PRICE AUCTIONS

2012 ◽  
Vol 14 (03) ◽  
pp. 1250019 ◽  
Author(s):  
ARIEH GAVIOUS ◽  
YIZHAQ MINCHUK
Keyword(s):  
Arithmetic Average ◽  
Negative Effect ◽  
Average Distribution ◽  
Expected Revenue ◽  
Second Price Auctions

We compare the seller's expected revenue in asymmetric second-price auctions with the benchmark case where all bidders have the average distribution. We show that with two bidders, asymmetry has a negative effect on revenue. However, for n > 2 bidders there is no clear observation we can make. We prove that in the case of weak asymmetry, sellers prefer asymmetry over low valuations and symmetry over high valuations. In addition, we show that a good approximation for the expected revenue in the case of weak asymmetry can be obtained by calculating the revenue of the symmetric auction with identical distributions equal to the geometric or arithmetic average.

Multi-armed bandits for bid shading in first-price real-time bidding auctions

2021 ◽  
pp. 1-15
Author(s):  
Tuomo Tilli ◽  
Leonardo Espinosa-Leal
Keyword(s):  
Real Time ◽  
Economic Benefit ◽  
Real Data ◽  
Demand Side ◽  
Production Environment ◽  
Online Advertisements ◽  
Ad Auctions ◽  
Real Scenario ◽  
Second Price Auctions ◽  
Naive Approach

Online advertisements are bought through a mechanism called real-time bidding (RTB). In RTB, the ads are auctioned in real-time on every webpage load. The ad auctions can be of two types: second-price or first-price auctions. In second-price auctions, the bidder with the highest bid wins the auction, but they only pay the second-highest bid. This paper focuses on first-price auctions, where the buyer pays the amount that they bid. This research evaluates how multi-armed bandit strategies optimize the bid size in a commercial demand-side platform (DSP) that buys inventory through ad exchanges. First, we analyze seven multi-armed bandit algorithms on two different offline real datasets gathered from real second-price auctions. Then, we test and compare the performance of three algorithms in a production environment. Our results show that real data from second-price auctions can be used successfully to model first-price auctions. Moreover, we found that the trained multi-armed bandit algorithms reduce the bidding costs considerably compared to the baseline (naïve approach) on average 29%and optimize the whole budget by slightly reducing the win rate (on average 7.7%). Our findings, tested in a real scenario, show a clear and substantial economic benefit for ad buyers using DSPs.

Economic Efficiency and the Canadian Health Care System

2010 ◽  
pp. 13-25
Author(s):  
Asha B. Sadanand
Keyword(s):  
Cost Effectiveness ◽  
Economic Efficiency ◽  
Public Funding ◽  
Healthcare Services ◽  
Canadian Health Care System ◽  
Medical Needs ◽  
Canadian Health ◽  
Canadian Health Care ◽  
The Individual ◽  
Second Price Auctions

In this chapter the authors examine the compatibility of the objectives of universality and public funding which are two important pillars of the Canadian healthcare system, with the objectives of cost effectiveness and more generally economic efficiency. The authors note that under some very innocuous conditions, markets and other economic based mechanisms such as second price auctions are characterized by economic efficiency and cost effectiveness. For the particular case of healthcare, some additional features that must be considered in the design of the mechanism are that healthcare services and products are valuable if, when taken together they constitute the components of a needed procedure, and otherwise they are worthless to the individual; and timely completion of procedures is what is valued, delays and waiting not only prolong suffering but may eventually prove to be more costly to the system if the condition worsens. They recommend a market-based mechanism, encompassing these features, that utilizes mobile agents representing patients and their medical needs. In order to incorporate the basic goals of universality and public funding, the agents will participate in virtual auctions using a needs based ranking as the currency for making bids.

scholarly journals Adverse Selection and Auction Design for Internet Display Advertising

2016 ◽  
Vol 106 (10) ◽  
pp. 2852-2866 ◽  
Author(s):  
Nick Arnosti ◽  
Marissa Beck ◽  
Paul Milgrom
Keyword(s):  
Adverse Selection ◽  
Auction Design ◽  
Display Advertising ◽  
Shill Bidding ◽  
Heavy Tailed Distributions ◽  
Price Auction ◽  
Second Price Auction ◽  
Heavy Tailed ◽  
The Cost ◽  
Second Price Auctions

We model an online display advertising environment in which “performance” advertisers can measure the value of individual impressions, whereas “brand” advertisers cannot. If advertiser values for ad opportunities are positively correlated, second-price auctions for impressions can be inefficient and expose brand advertisers to adverse selection. Bayesian-optimal auctions have other drawbacks: they are complex, introduce incentives for false-name bidding, and do not resolve adverse selection. We introduce “modified second bid” auctions as the unique auctions that overcome these disadvantages. When advertiser match values are drawn independently from heavy-tailed distributions, a modified second bid auction captures at least 94.8 percent of the first-best expected value. In that setting and similar ones, the benefits of switching from an ordinary second-price auction to the modified second bid auction may be large, and the cost of defending against shill bidding and adverse selection may be low. (JEL D44, D82, L86, M37)

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