2014/11/18 by Michal Feldman, Feldman, Michal, Nick Gravin +3 · 5 citations
Business, Management and Accounting · Decision Sciences · Economics, Econometrics and Finance · #Auction Theory and Applications #Computer Science and Game Theory (cs.GT) #Consumer Market Behavior and Pricing #FOS: Computer and information sciences #Game Theory and Voting Systems
paper · pdf · doi:10.48550/arxiv.1411.4916
openalex publication_date 2014/11/18 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/28
We study anonymous posted price mechanisms for combinatorial auctions in a Bayesian framework. In a posted price mechanism, item prices are posted, then the consumers approach the seller sequentially in an arbitrary order, each purchasing her favorite bundle from among the unsold items at the posted prices. These mechanisms are simple, transparent and trivially dominant strategy incentive compatible (DSIC). We show that when agent preferences are fractionally subadditive (which includes all submodular functions), there always exist prices that, in expectation, obtain at least half of the optimal welfare. Our result is constructive: given black-box access to a combinatorial auction algorithm A, sample access to the prior distribution, and appropriate query access to the sampled valuations, one can compute, in polytime, prices that guarantee at least half of the expected welfare of A. As a corollary, we obtain the first polytime (in n and m) constant-factor DSIC mechanism for Bayesian submodular combinatorial auctions, given access to demand query oracles. Our results also extend to valuations with complements, where the approximation factor degrades linearly with the level of complementarity.