| and Seller Priorities (2008) | |||||||||||||
Abstract | |||||||||||||
| Abstract. Auctions and exchanges are one of the most important market mechanisms for price determination and allocation of goods. In this paper we consider the case when each buyer has a limited budget and wishes to buy at most one item in multi-item auctions. We show the limitations of two known mechanisms – sequence of single-item auctions and recently introduced XOR double auctions – and introduce a new mechanism, so called XOR (double) auc-tion with buyer preferences (XOR-(D)ABP), which avoids these limitations. In the proposed mechanism buyers specify preferences on the items on which they bid. We seek allocations of the items to the buyers which are stable with respect to buyer’s preferences, i.e., items which are preferable to the item allocated to a buyer are sold for a price higher or equal to what she offered for them. In the case of double auctions, the allocation should also ensure fairness to the sellers: if an item received a bid with a higher value than the allocated | |||||||||||||
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