672 pp., 7 x 9 in, 11 illus.
- Published: December 9, 2005
- Publisher: The MIT Press
- Published: January 22, 2010
- Publisher: The MIT Press
A synthesis of theoretical and practical research on combinatorial auctions from the perspectives of economics, operations research, and computer science.
With a foreword by Vernon L. Smith, recipient of the 2002 Nobel Prize in Economics.
The study of combinatorial auctions—auctions in which bidders can bid on combinations of items or "packages"—draws on the disciplines of economics, operations research, and computer science. This landmark collection integrates these three perspectives, offering a state-of-the art survey of developments in combinatorial auction theory and practice by leaders in the field.
Combinatorial auctions (CAs), by allowing bidders to express their preferences more fully, can lead to improved economic efficiency and greater auction revenues. However, challenges arise in both design and implementation. Combinatorial Auctions addresses each of these challenges. After describing and analyzing various CA mechanisms, the book addresses bidding languages and questions of efficiency. Possible strategies for solving the computationally intractable problem of how to compute the objective-maximizing allocation (known as the winner determination problem) are considered, as are questions of how to test alternative algorithms. The book discusses five important applications of CAs: spectrum auctions, airport takeoff and landing slots, procurement of freight transportation services, the London bus routes market, and industrial procurement. This unique collection makes recent work in CAs available to a broad audience of researchers and practitioners. The integration of work from the three disciplines underlying CAs, using a common language throughout, serves to advance the field in theory and practice.
Combinatorial auctions is an important interdisciplinary field combining issues from economics, game theory, optimization, and computer science. The book presents a great collection of state-of-the-art surveys with a well-balanced view integrating all aspects. A very impressive accomplishment! It will help us all appreciate the full range of issues, and will be a great reference for years to come.
Éva Tardos, Cornell University
This important volume addresses many of the crucial issues in modern auction design. Containing insightful contributions from many of the world's leading market designers and auction theorists, it will be an essential reference for scholars and practitioners alike.
Paul Klemperer, Oxford University
Combinatorial Auctions is excellent and exceptional in practically all attributes I would care about in this type of work. This includes the breadth and depth of the topics covered and the language employed. Additionally, my praise also extends to minor details, such as the existence of an exhaustive author and subject index, and the quality of its typesetting, especially with regard to the mathematical apparatus used in some of the chapters. For researchers and practitioners, both on the seller side and on the buyer side, who deal with (combinatorial) auctions, this book is a must-read.
Anyone with an interest in auction theory, market design, and more broadly, practical applications of game theory, will find this book extremely valuable both as a reference to the existing work on combinatorial auctions and as a source of topics and ideas for new research.
Journal of Economic Literature
'Smart' markets, which allow participants to bid for packages of items, are now an attractive option for sales and procurements in a variety of settings. This book provides a comprehensive overview of both theoretical considerations and practical details. It is remarkable for combining economics, game theory, optimization, and computer science in a unified perspective. Combinatorial Auctions is a major advance in the theory and practice of market design.
Robert Wilson, Stanford University
The study of combinatorial auctions has importance both practical and theoretical. In combinatorial auctions, our elegant models of resource allocation confront the true complexity of markets, where potential traders compete to buy or sell many different but related goods. Combinatorial auctions are the great frontier of auction theory today, and this book provides a state-of-the-art survey of this exciting field.
Roger Myerson, University of Chicago, Nobel Prize in Economics 2007
This book is indispensable for all researchers and practitioners that want to get introduced to the world of combinatorial auctions.
Operations Research Letters