Related papers: Is Collusion-Proof Procurement Expensive?
We study the problem of designing procurement auctions for the strategic uncapacitated facility location problem: a company needs to procure a set of facility locations in order to serve its customers and each facility location is owned by…
There is growing concern about tacit collusion using algorithmic pricing, and regulators need tools to help detect the possibility of such collusion. This paper studies how to design a hypothesis testing framework in order to decide whether…
Algorithmic price collusion facilitated by artificial intelligence (AI) algorithms raises significant concerns. We examine how AI agents using Q-learning engage in tacit collusion in two-sided markets. Our experiments reveal that AI-driven…
Competing firms can increase profits by setting prices collectively, imposing significant costs on consumers. Such groups of firms are known as cartels and because this behavior is illegal, their operations are secretive and difficult to…
The prospect of collusive agreements being stabilized via the use of pricing algorithms is widely discussed by antitrust experts and economists. However, the literature is often lacking the perspective of computer scientists, and seems to…
We consider repeated multi-unit auctions with uniform pricing, which are widely used in practice for allocating goods such as carbon licenses. In each round, $K$ identical units of a good are sold to a group of buyers that have valuations…
Bid leakage is a corrupt scheme in a first-price sealed-bid auction in which the procurer leaks the opponents' bids to a favoured participant. The rational behaviour of such participant is to bid close to the deadline in order to receive…
Pricing decisions are increasingly made by AI. Thanks to their ability to train with live market data while making decisions on the fly, deep reinforcement learning algorithms are especially effective in taking such pricing decisions. In…
Recurring auctions are ubiquitous for selling durable assets like artworks and homes, with follow-up auctions held for unsold items. We investigate such auctions theoretically and empirically. Theoretical analysis demonstrates that…
Recent scholarly work has extensively examined the phenomenon of algorithmic collusion driven by AI-enabled pricing algorithms. However, online platforms commonly deploy recommender systems that influence how consumers discover and purchase…
Algorithmic pricing on online e-commerce platforms raises the concern of tacit collusion, where reinforcement learning algorithms learn to set collusive prices in a decentralized manner and through nothing more than profit feedback. This…
This paper examines bid requirements, where the government may cancel a procurement contract unless two or more bids are received. Using a first-price auction model with endogenous entry, we compare the bid requirement and reserve price…
The plethora of comparison shopping agents (CSAs) in today's markets enables buyers to query more than a single CSA when shopping, and an inter-CSAs competition naturally arises. We suggest a new approach, termed "selective price…
Combinatorial auctions where agents can bid on bundles of items are desirable because they allow the agents to express complementarity and substitutability between the items. However, expressing one's preferences can require bidding on all…
The rise of autonomous pricing systems has sparked growing concern over algorithmic collusion in markets from retail to housing. This paper examines controlled information quality as an ex ante policy lever: by reducing the fidelity of data…
Consider sellers in a competitive market that use algorithms to adapt their prices from data that they collect. In such a context it is plausible that algorithms could arrive at prices that are higher than the competitive prices and this…
This paper investigates reverse auctions that involve continuous values of different types of goods, general nonconvex constraints, and second stage costs. We seek to design the payment rules and conditions under which coalitions of…
We consider an outsourcing problem where a software agent procures multiple services from providers with uncertain reliabilities to complete a computational task before a strict deadline. The service consumer requires a procurement strategy…
Collusion and capacity withholding in electricity wholesale markets are important mechanisms of market manipulation. This study applies a refined machine learning-based cartel detection algorithm to two cartel cases in the Italian…
Recent spectrum auctions in the United Kingdom, and some proposals for future auctions of spectrum in the United States, are based on preliminary price discovery rounds, followed by calculation of final prices for the winning buyers. For…