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Topic: Vickrey auction

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English auction

Auction

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William Vickrey

Opportunity cost

Eric Mindich

	The Bidding Game - Which Auction Is Best?
		Vickrey’s brilliant study of auction strategies was ahead of its time: Written in 1961 when economists were only starting to get a sense of game theory’s importance, it was relegated to an obscure journal and overlooked for years.
		Vickrey, who earned the Nobel Memorial Prize in Economics in 1996 partly for his work on auction theory, studied what economists call “private value” auctions, in which each bidder’s value for the item for sale is independent of the values of the other bidders.
		The Dutch auction and the first-price auction are also equivalent to each other, since in a Dutch auction, the prize goes to the bidder willing to bid highest, and she pays what she bids.
	www.beyonddiscovery.org /content/view.page.asp?I=3685 (1165 words)

	Vickrey auction - Education - Information - Educational Resources - Encyclopedia - Music
		The auction was created by William Vickrey to reduce winner's curse by encouraging people to bid what they believe the object is trully worth.
		For that reason, the name "Vickrey auction" in the multi-good auction is often reserved for a more complicated pricing scheme based on opportunity cost, which does give bidders the incentive to bid truthfully.
		Vickrey auctions are much studied in economic literature, but are not particularly common in practice.
	www.music.us /education/V/Vickrey-auction.htm (442 words)

	Vickrey Auction
		A Vickrey auction is a type of sealed-bid auction, where bidders submit written bids without knowing the bid of the other people in the auction.
		Vickrey auctions are much studied in economic literature, but are not particularly common in practice.
		A Vickrey auction is ex-post efficient (the winner is the bidder with the highest valuation) under the most general circumstances; it thus provides a baseline model against which the efficiency properties of other types of auctions can be posited.
	www.auctions.tiptophot.com /Vickrey_auction.html (323 words)

	NationMaster - Encyclopedia: Vickrey auction (Site not responding. Last check: )
		For that reason, the name "Vickrey auction" in the multi-good auction is usually reserved by economists for a more complicated pricing scheme based on opportunity cost, which does give bidders the incentive to bid truthfully.
		Vickrey auctions are much studied in economic literature, but are not particularly common in practice.
		A Vickrey auction is ex-post efficient (the winner is the bidder with the highest valuation) under the most general circumstances; it thus provides a baseline model against which the efficiency properties of other types of auctions can be posited.
	www.nationmaster.com /encyclopedia/Vickrey-auction (1463 words)

	Vickrey auction
		The auction was created by William Vickrey to reduce winner's curse by encouraging people to bid what they believe the object is trully worth.
		In this case, the terms Vickrey auction and second-price auction are equivalent, and are used interchangeably.
		For that reason, the name "Vickrey auction" in the multi-good auction is often reserved for a more complicated pricing scheme based on opportunity cost, which does give bidders the incentive to bid truthfully.
	www.xasa.com /wiki/en/wikipedia/v/vi/vickrey_auction.html (248 words)

	Optimal Auction for the Seller
		An auction is composed of two parties, the seller or auctioneer and the bidders.
		Vickrey auction which is a second price sealed bid auction, allows bidders to bid upwards aggressively without a heavy penalty of the winners curse and also since it is a sealed auction, it disables rings from working effectively.
		Concluding, Vickrey auction may be an optimal auction comparatively, but because of its complex rules and strategy, its feasibility in most kinds of real life auctions is questionable.
	www.contrib.andrew.cmu.edu /~skanajan/report/optimalSeller.html (557 words)

	Additional background material on the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel 1996
		Among Vickrey's better-known activities as a consultant are also his studies of the transportation and traffic system in Washington DC in the late 1950s and his service as an advisor to the UN on taxation.
		The auction also distributes the good in a socially, efficient way; the object goes to the bidder with the highest willingness to pay, and the bidder in question pays the social opportunity cost which is the second highest bid.
		Vickrey's most creative endeavor regarding taxation is his article "Measuring Marginal Utility by Reactions to Risk" (1945), which addresses the balance between efficiency and equity in designing an income tax system.
	nobelprize.org /nobel_prizes/economics/laureates/1996/back.html (6843 words)

	[No title]
		In an auction environment with a stochastic supply of divisible asset, we characterize the symmetric strategy equilibria for three alternative auction formats: the Vickrey auction, the uniform-price auction, and the discriminatory ("pay your bid") auction.
		We show that the Vickrey auction has a unique dominant-strategy linear equilibrium that is independent of the distribution of supply noise.
		Unique, linear strategy equilibria are also obtained for the uniform-price and discriminatory auctions (in the latter case, we assume that the distribution of the supply noise is uniform).
	www.duke.edu /%7Echarvey/Finance/absf9621.htm (270 words)

	Antisocial Agents and Vickrey Auctions - Brandt, Wei (ResearchIndex) (Site not responding. Last check: )
		Abstract: In recent years auctions have become more and more important in the field of multiagent systems as useful mechanisms for resource allocation and task assignment.
		In many cases the Vickrey (second-price sealed-bid) auction is used as a protocol that prescribes how the individual agents have to interact in order to come to an agreement.
		We show that the Vickrey auction, despite its theoretical benefits, is inappropriate if "antisocial" agents participate in the auction process.
	citeseer.ist.psu.edu /497836.html (619 words)

	Get More for Your Money: Auction Off Your Legal Work
		Although auctions are generally a great idea for law departments, it's a good idea to have a clear understanding of the different types of auctions and how to choose the right one.
		The third kind of auction that general counsel should understand is called a Vickrey auction, named after William Vickrey, the British economist who first wrote about this kind of auction.
		Auctions make sense for law departments that foresee a sizable expenditure, such as more than $1 million, in the coming one to three years.
	www.law.com /jsp/ihc/PubArticleIHC.jsp?id=1138096932714 (1646 words)

	Professional Auction and Appraisal services in Michigan
		In reality, the auction chant is one of the last components a professional auctioneer learns and in many cases, the high octane speed chant is not appropriate in many auction settings.
		A career auctioneer is a highly skilled auction professional that has generally invested thousands of dollars in education and continuing education to learn the necessities of the auction business.
		By becoming adequately informed of the potential pitfalls in the auction industry, this will ensure that the profession continues to be one that is not only an integral part of a vital economy, but also one that is consistently given the respect it has earned through centuries of trusted and proven service to the public.
	www.aeauctions.com /whyhire.html (1101 words)

	Internet Auction Models
		In a Vickrey Auction the bids are sealed and each bidder bids from his own expectation, ignorant of all the other bids.
		This can be explained with the fact that in a Vickrey Auction the bidder will adjust his bids upward, since he knows that he only needs to pay the second highest bid.
		This auction format is called a Dutch Auction by edeal (not to be confused with the academic Dutch Auction).
	ids.csom.umn.edu /faculty/kauffman/courses/8420/Projects/Engebretsen/internet_auction_models.htm (5988 words)

	The Prize in Economics 1996 - Press Release
		Vickrey's analysis, in the mid-1940s, emphasized that a progressive tax schedule would affect individuals' incentives to exert themselves.
		Vickrey analyzed the properties of different kinds of auctions in two papers in 1961 and 1962.
		He attached particular importance to the second-price auction or, as it is now often called, the Vickrey auction.
	nobelprize.org /nobel_prizes/economics/laureates/1996/press.html (1750 words)

	Research - The High Price of Internet Keyword Auctions - Stanford GSB
		The auction Vickrey designed has a remarkable property: The best strategy for the buyers is to bid precisely what they feel the item in question is worth to them.
		Rather than paying the amount they’ve bid, however, in the current auction system advertisers are charged only a penny more per click than the next lowest bid, with some adjustments that depend on the quality of the ad.
		In a true Vickrey auction, an advertiser would indeed be charged less than his actual bid, but the precise figure would be calculated differently.
	www.gsb.stanford.edu /news/research/econ_ostrovsky_internetauction.shtml (1067 words)

	Auction Types & Terms
		If a case of coffee mugs is being auctioned, and bidders have to bid on the whole case, then this would be a single unit auction.
		Vickrey auctions on the Internet are sometimes conducted as open auctions (all bidders can see all bids) and sometimes closed.
		During the "auction" phase all items being auctioned are put on display with a basket (or jar or whatever) in front of each item.
	www.auctusdev.com /auctiontypes.html (1678 words)

	Auction Types
		Reverse Auctions are a specialized auction format that allows individuals/organizations to procure goods and services at the lowest possible price.
		Dutch auctions are special type of auction designed to handle the case where a buyer has a number of identical items they wish to buy.
		A Yankee Auction is a variation of the Dutch Auction where successful bidders sell what they bid as opposed to selling at the price determined by the lowest qualified bidder (as in a Dutch Auction).
	auctionsaloon.com /help/rev_auctiontypes.cfm (698 words)

	Vickrey Auctions Predate Vickrey
		William Vickrey (1961) proposed an auction mechanism in which bidders submit sealed bids, and the highest bidder wins the good in return for payment of the second-highest bid amount.
		For decades, economists have credited Vickrey with inventing this auction format, and have believed that the Vickrey auction is rarely used in practice.
		Stamp auctioneers developed this auction format on their own, as early as 1893, even before Vickrey was born.
	www.u.arizona.edu /~dreiley/papers/VickreyHistory.html (91 words)

	Google IPO
		The auction method to be used is a multiple unit, homogenous, modified Vickrey auction.
		A pure Vickrey auction is also known as a “closed second-price” auction by the academics.
		In a pure Vickrey auction the optimal strategy for bidders is to bid their true maximum value.
	www.auctusdev.com /googleipo.html (870 words)

	Metanews: Nobelist William Vickrey, 1914-1996
		William Vickrey would have been the first to admit that he relished the media attention surrounding his Nobel Prize in Economic Science awarded last Oct. 8.
		Vickrey's restless intellect has covered more ground," but went on to explain Vickrey's auction theory -- in which the winner pays only the second-highest bid -- with simplified illustrations.
		This, says Johnson, was Vickrey's idiosyncratic form of modesty, not a license to dwell exclusively upon practical schemes such as optimal pricing for traffic jams rather than the complex theory that reinforced them or his ideas on other topics that are accessible to the lay audience, such as budget deficits.
	www.columbia.edu /cu/21stC/issue-2.2/rodgers.html (586 words)

	Vickrey auction
		A silent auction in which the object being sold goes to the second-highest bidder.
		In a normal silent auction prospective buyers place their bids in sealed envelopes and the highest bid wins.
		Because when all other bids fixed and unknown to a given bidder, that bidder's optimal strategy is to bid what she thinks the object is worth.
	www.daviddarling.info /encyclopedia/V/Vickrey_auction.html (284 words)

	Second Price Auctions
		While most people are familiar with traditional auctions where bids are open and the winning bidder pays the full amount of his or her bid, there are times when that type of auction may not be in the best interest of the seller.
		When the auction ends, Bidder D is the clear winner and he purchases 13 of the available chairs for $40 (the highest losing bid) each.
		One stipulation with these type of auctions is that if the quantity a bidder requests is no longer available, the bidder does not have to purchase a partial quantity.
	www.epiqtech.com /auction_software-Second-Price-Auction.htm (766 words)

	Glossary of Auction and Appraisal Terms - Courtesy of the Ohio Auction School
		An auctioneer who is in training, operating under the supervision of a licensed or experienced auctioneer.
		A contract executed by the auctioneer and the seller which authorizes the auctioneer to conduct the auction and sets out the terms of the agreement and the rights and responsibilities of each party.
		An auction in which the seller reserves the right to establish a reserve price, to accept or decline any and all bids or to withdraw the property at any time prior to the announcement of the completion of the sale by the auctioneer.
	www.pgauctioneer.com /glossary.html (3282 words)

	User Help
		English auctions also allow the seller to specify a reserve price below which the item will not be sold.
		Dutch auctions are special type of auction designed to handle the case where a seller has a number of identical items to sell.
		A Yankee Auction is a variation of the Dutch Auction where successful bidders pay what they bid as opposed to paying the price determined by the lowest qualified bidder (as in a Dutch Auction).
	www.auctionsaloon.com /help (640 words)

	IISc - Intel Resource for e-Business Market Algorithms: Auctions
		Auction algorithm for assignment and other network flow problems: A tutorial introduction.
		Auctions-the big winner among trading mechanisms for the internet economy.
		Last minute bidding and the rules for ending second-price auctions: theory and evidence from a natural experiment on the internet (working paper).
	lcm.csa.iisc.ernet.in /IntelWebPage/auctions.html (887 words)

	Putting Auction Theory to Work - Cambridge University Press (Site not responding. Last check: )
		Providing a comprehensive introduction to modern auction theory and its important new applications, this book is written by a leading economic theorist whose suggestions guided the creation of the new spectrum auction designs.
		Aimed at graduate students and professionals in economics, the volume provides the most up-to-date analysis of traditional theories of "optimal auctions" as well as newer theories of multi-unit auctions and package auctions, and shows by example how these theories are used.
		Professor Milgrom is a pioneer in the economic theory of auctions and co-designer of the simultaneous, multiple round auction that the FCC adopted for selling radio spectrum licenses.
	www.cambridge.org /us/catalogue/catalogue.asp?isbn=0521536723 (680 words)

	GeekList: Auction Systems \| BoardGameGeek
		The Dollar Auction is a game theory case study where a dollar is auctioned (normally english style) with the top bidder winning, but the top two bidders paying.
		If this auction also ends in a tie, then a third auction is conducted, with the minimum bid being the high bid of the previous auction.
		Some cards start double auctions in which a second card by the same artist is auctioned with the double auction card as one lot.
	www.boardgamegeek.com /geeklist/587 (1523 words)

	Ausubel, Lawrence: A Generalized Vickrey Auction
		In auction environments where bidders have pure private values, the Vickrey auction (Vickrey, 1961) provides a simple mechanism for efficiently allocating homogeneous goods.
		However, in environments where bidders have interdependent values, the Vickrey auction does not generally yield efficiency.
		The payment rule is the following extension of Vickrey auction pricing: a bidder is charged for a given unit that she wins according to valuations evaluated at the minimum signal that she could have reported and still won that unit.
	www.nuff.ox.ac.uk /users/doornik/eswc2000/a/1257.html (131 words)

	CSC 413 Practice Questions (Site not responding. Last check: )
		ANSWER: In an English auction, the winner pays the highest price (that is the price that they bid to win).
		In a Vickrey auction, the winner pays the price that the 2nd highest bidder bid.
		Also, a Vickrey auction is a sealed-bid auction, while the English auction is an outcry auction.
	ecommerce.ncsu.edu /technology/study-questions/study-auctions-a.html (642 words)

	AdWords bid price
		A Vickrey Auction is where the highest bidder wins - but he/she only pays the second highest bidding price.
		If you participate in a Vickrey Auction, you can safely bid the maximum price that makes sense to you in the knowledge that if you win, you will pay less than this.
		Google uses a variation on the Vickrey Auction model to determine how much you pay when your ad is clicked.
	www.factsaboutadsense.com /vickrey.htm (1170 words)

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