Optimal Auction Design.¶
Myerson, R. B. (1981). Optimal Auction Design. Mathematics of Operations Research, 6(1), 58-73.
Cited by¶
6 citations across 6 artifacts.
Each citation links to the sentence it supports in the citing article.
Primes¶
- Auction Theory
- Auction theory collapses a bewildering diversity of auction formats and bidder situations into a small family of analytically tractable cases organized by value structure (independent private values, common values, correlated values) and payment rule (first-price, second-price, pay-your-bid, pay-the-clearing-price), the taxonomy Myerson (1981) deploys in his optimal-auction-design analysis.
This sourceDerives revenue-maximizing single-object auctions via virtual valuations and a reserve where virtual valuation is zero.
- Auction theory collapses a bewildering diversity of auction formats and bidder situations into a small family of analytically tractable cases organized by value structure (independent private values, common values, correlated values) and payment rule (first-price, second-price, pay-your-bid, pay-the-clearing-price), the taxonomy Myerson (1981) deploys in his optimal-auction-design analysis.
- Incentive Compatibility
This sourceCanonical derivation of revenue-maximizing mechanisms under private information; establishes the formal pattern of mapping private valuations and self-interest to rule-and-reward design that produces aligned equilibrium outcomes.
- Mechanism Design
- built the modern apparatus.
This sourceCanonical derivation of revenue-maximizing mechanisms under private information; establishes the formal pattern of mapping private valuations and self-interest to rule-and-reward design that produces aligned equilibrium outcomes.
- built the modern apparatus.
Domain-specific¶
- Bayesian Optimal Mechanism
- Change any of those and a different mechanism can become optimal.
This sourceFoundational optimization of expected seller utility over feasible direct auction mechanisms, including virtual values and irregular cases.
- Change any of those and a different mechanism can become optimal.
- Vickrey Auction
- Vickrey also showed that, under symmetric independent private values and risk-neutral bidders, the second-price sealed-bid auction yields the same expected seller revenue as the ascending-price English auction, the declining-price Dutch auction, and the first-price sealed-bid auction — the Revenue Equivalence Theorem, later generalised by Roger Myerson and by John Riley and William Samuelson.
This sourceMyerson's derivation of optimal auctions for a wide class of auction design problems, the generalisation the sentence names.
Supported in partVerified against the publisher's abstract
“The seller's problem is to design an auction game which has a Nash equilibrium giving him the highest possible expected utility.”
- Vickrey also showed that, under symmetric independent private values and risk-neutral bidders, the second-price sealed-bid auction yields the same expected seller revenue as the ascending-price English auction, the declining-price Dutch auction, and the first-price sealed-bid auction — the Revenue Equivalence Theorem, later generalised by Roger Myerson and by John Riley and William Samuelson.
- Virtual Valuation
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