A major trend in mobile advertising is the emergence of real time bidding (RTB) based marketplaces on the supply side and the corresponding programmatic impression buying on the demand side. In order to acquire the most relevant audience impression at the lowest cost, a demand side player has to accurately estimate the win rate and winning price in the auction, and incorporate that knowledge in...

The anomaly is concerned with the observation that in multiple-item auctions of identical objects, prices tend to decline over time. We show that in the case of wine auctions which have been analyzed frequently, the anomaly is likely to be caused by the fact that most bids are entered by absentees, who seem to use nonoptimal bidding strategies. Therefore, wine auctions can hardly be used to ill...

A search engine can be modeled as a mapping that takes in user keywords as input and produces search results as output. Currently, the most dominant form of search advertising is input bidding where advertisers bid to associate their advertisements with keywords. We propose output bidding where advertisers bid to associate their advertisements with search results without changing or replacing a...

Retailers are increasingly exploiting sequential online auctions as an effective and low cost distribution channel for disposing large quantities of inventory. In such auction environments, bidders have the opportunity of participating in many auctions to learn and choose the bidding strategy that best fits their preferences. Previous studies have mostly focused on identifying bidding strategie...

An auction is externality-robust if unilateral deviations from equilibrium leave the other bidders’ payoffs unaffected. The equilibrium and its outcome will then persist if certain types of externalities arise between bidders. One example are externalities due to spiteful preferences, which have been used to explain overbidding in the second-price auction (SPA). Another example are cross-shareh...

The sequential auction problem is commonplace in open, electronic marketplaces such as eBay. This problem occurs when a buyer faces a complex strategic problem in bidding across multiple auctions, each selling similar or essentially identical items and when the buyer would have a simple, truth-revealing strategy if there was but a single auction event. Our model allows for multiple, distinct go...

We introduce endogenous fees for participating in second-price auction which we use for a two-stage mechanism to solve King Solomon’s dilemma. They are positive for all agents. They are nonetheless shown to maintain the agents’ incentives for truthful bidding and guarantee participation by the highest-value agent. This feature of the endogenous fees is powerful enough for the efficient outcome ...

It is shown that the linkage principle (Milgrom and Weber (1982)) does not extend to the multi-unit auction setting. An analysis of the equilibium bidding strategies is carried out for the general two-agent/two-unit Vickrey auction in order to provide economic insight into the nature of the failure. In addition, an explicit counterexample is provided. ∗ Both authors acknowledge support from the...

Group-buying ads seeking a minimum number of customers before the deal expiry are increasingly used by the daily-deal providers. Unlike the traditional web ads, the advertiser’s profits for group-buying ads depends on the time to expiry and additional customers needed to satisfy the minimum group size. Since both these quantities are time-dependent, optimal bid amounts to maximize profits chang...