DO&IT Seminar Series
http://www.rhsmith.umd.edu/doit/events/seminars.aspx
Speaker:
Professor Ozan Candogan, Duke
Date:
Friday, November 7, 2014
Time:
10:30 am - 11:30 AM
Location:
Room 1212
Title:
“Efficient Iterative Auctions for Multi-Featured Items: A Network
Flow Approach”
Abstract:
We develop a methodology for the design of efficient iterative auctions for heterogeneous items
whose values are expressed in terms of a finite set of features they possess. Bidders have
decreasing marginal values for each feature, and their value for a bundle is the sum of individual
feature valuations associated with this bundle. This feature-driven representation of valuations
allows us to formulate a novel (multicommodity) network flow representation of the efficient allocation problem. Using the integrality of the optimal solutions to the min-cost flow problem, we
establish the existence of a Walrasian equilibrium for F-feature valuations (first with F = 2, and
subsequently with F > 2 under additional structural assumptions). We also show that F - feature
valuations might not exhibit substitutability even for F = 2, thereby revealing a new class of
valuations for which a Walrasian equilibrium exists. By analyzing the structural properties of the
optimal solutions to the network flow problem for 2-feature valuations, we develop an iterative
algorithm that finds the efficient allocation in this setting. Furthermore, a single run of the
procedure collects sufficient information to compute VCG payments. Thus, complementing the
algorithm with this payment rule, we obtain a new iterative auction in which it is an (ex-post)
equilibrium to bid truthfully, and the equilibrium is efficient. Our approach suggests that
analyzing (i) alternative valuation representations, and (ii) network flow formulation of the
efficient allocation problem, could potentially reveal other valuation classes for which a
Walrasian equilibrium exists, and simple iterative auctions which implement an efficient
outcome.
Van Munching Hall
▫
Room 4306
▫
Telephone 301-405-8654
▫
College Park, MD
▫
University of Maryland
Bio:
Ozan Candogan is an assistant professor at the Fuqua School of Business, where he is a member
of the Decision Sciences area. Prior to joining Fuqua, he received his Ph.D. and M.S. degrees in
Electrical Engineering and Computer Science from the Massachusetts Institute of Technology.
Ozan Candogan’s research interests are in mechanism design, decision making in social and
economic networks, and analysis of dynamic strategic interactions. His most recent work focuses
on the design of novel iterative auction mechanisms for efficient allocation of resources. His
research has appeared in journals such as Management Science, Operations Research,
Mathematics of Operations Research, and Games and Economic Behavior.
Ozan Candogan is a recipient of the 2012 Microsoft Research Ph.D. fellowship, and 2009 Siebel
Scholarship. He was also a finalist in the 2013 George Nicholson Student Paper Competition. He
teaches decision models in the executive MBA programs at Fuqua.
Van Munching Hall
▫
Room 4306
▫
Telephone 301-405-8654
▫
College Park, MD
▫
University of Maryland