Sets in Excess Demand in Ascending Auctions with Unit-Demand Bidders

Abstract

This paper analyzes the problem of selling a number of indivisible items to a set of unit-demand bidders. An ascending auction mechanism called the Excess Demand Ascending Auction (EDAA) is defined. The main results demonstrate that EDAA terminates in a finite number of iterations and that the exact auction mechanism in Demange, Gale and Sotomayor (J. Polit. Economy 94: 863-872, 1986) and its modification based on the Ford-Fulkerson method, proposed by Sankaran (Math. Soc. Sci. 28: 143-150, 1994), reduce to special cases of EDAA.

Keywords: Multi-Item Auction, Unit-Demand Bidders, Excess Demand, Algorithms

JEL Classification: C62, D44, D50