A note on the efficiency of position mechanisms with budget constraints

Alexandros A. Voudouris

A note on the efficiency of position mechanisms with budget constraints

Computer Science and Game Theory 2018-11-27 v2

Authors: Alexandros A. Voudouris

Abstract

We study the social efficiency of several well-known mechanisms for the allocation of a set of available (advertising) positions to a set of competing budget-constrained users (advertisers). Specifically, we focus on the Generalized Second Price auction (GSP), the Vickrey-Clarke-Groves mechanism (VCG) and the Expressive Generalized First Price auction (EGFP). Using the liquid welfare as our efficiency benchmark, we prove a tight bound of 2 on the liquid price of anarchy and stability of these mechanisms for pure Nash equilibria.

Keywords

position mechanisms budget constraints social efficiency generalized second price auction vickrey-clarke-groves liquid welfare price of anarchy

Cite

@article{arxiv.1804.09649,
  title  = {A note on the efficiency of position mechanisms with budget constraints},
  author = {Alexandros A. Voudouris},
  journal= {arXiv preprint arXiv:1804.09649},
  year   = {2018}
}