Competing Combinatorial Auctions

This is the author accepted manuscript of the article published in Information Systems Research, which is available at https://doi.org/10.1287/isre.2021.1018.

38 Pages Posted: 16 Sep 2021

See all articles by Thomas Kittsteiner

Thomas Kittsteiner

RWTH Aachen University - School of Business and Economics

Marion Ott

ZEW – Leibniz Centre for European Economic Research

Richard Steinberg

London School of Economics and Political Science

Date Written: March 01, 2021

Abstract

We investigate whether revenue-maximizing auctioneers selling heterogeneous items will allow for combinatorial bidding in the presence of auctioneer competition. We compare the choice of auction format by two competing auctioneers with that of a single auctioneer. Bidders are heterogeneous in their demands, with some having synergies for items. We find that, even if a single auctioneer offers a combinatorial auction, competing auctioneers in a comparable setting will not. Instead, the competing auctioneers will segment the market by restricting allowable package bids in order to increase competition between bidders. This shows that it might not be advantageous for an online market platform to offer combinatorial auctions as a design option to competing auctioneers.

Keywords: Competing auctioneers, combinatorial auction, electronic marketplace, VCG mechanism

JEL Classification: D44, C72, D82

Suggested Citation

Kittsteiner, Thomas and Ott, Marion and Steinberg, Richard, Competing Combinatorial Auctions (March 01, 2021). This is the author accepted manuscript of the article published in Information Systems Research, which is available at https://doi.org/10.1287/isre.2021.1018., Available at SSRN: https://ssrn.com/abstract=3923308

Thomas Kittsteiner

RWTH Aachen University - School of Business and Economics ( email )

Templergraben 55
52056 Aachen, 52056
Germany

Marion Ott (Contact Author)

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

Richard Steinberg

London School of Economics and Political Science ( email )

Dept. of Management, NAB 3.08
Houghton Street
London, WC2A 2AE
United Kingdom

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