Optimal Auction Design.

Myerson, R. B. (1981). Optimal Auction Design. Mathematics of Operations Research, 6(1), 58-73.

Type

Journal article

Intellectual base

Primary research

Year

1981

DOI

10.1287/moor.6.1.58

Link

https://doi.org/10.1287/moor.6.1.58

Cited from

economics_finance

Cited by

5 citations across 5 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

• 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.

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.

• Virtual Valuation
  • Myerson's optimal-auction analysis uses this transformation to express expected revenue as expected virtual surplus for incentive-compatible mechanisms under the model's hypotheses.

Verification

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