On random sampling auctions for digital goods
Title | On random sampling auctions for digital goods |
Publication Type | Conference Papers |
Year of Publication | 2009 |
Authors | Alaei S, Malekian A, Srinivasan A |
Conference Name | Proceedings of the 10th ACM conference on Electronic commerce |
Date Published | 2009/// |
Publisher | ACM |
Conference Location | New York, NY, USA |
ISBN Number | 978-1-60558-458-4 |
Keywords | auction, mechanism design, random sampling |
Abstract | In the context of auctions for digital goods, an interesting Random Sampling Optimal Price auction (RSOP) has been proposed by Goldberg, Hartline and Wright; this leads to a truthful mechanism. Since random sampling is a popular approach for auctions that aims to maximize the seller's revenue, this method has been analyzed further by Feige, Flaxman, Hartline and Kleinberg, who have shown that it is 15-competitive in the worst case -- which is substantially better than the previously proved bounds but still far from the conjectured competitive ratio of 4. In this paper, we prove that RSOP is indeed 4-competitive for a large class of instances in which the number λ of bidders receiving the item at the optimal uniform price, is at least 6. We also show that it is 4.68 competitive for the small class of remaining instances thus leaving a negligible gap between the lower and upper bound. Furthermore, we develop a robust version of RSOP -- one in which the seller's revenue is, with high probability, not much below its mean -- when the above parameter λ grows large. We employ a mix of probabilistic techniques and dynamic programming to compute these bounds. |
URL | http://doi.acm.org/10.1145/1566374.1566402 |
DOI | 10.1145/1566374.1566402 |