The second-price bidding system under uncertainty

Harunori Shishido; Dao Zhi Zeng; Xiaoguang Yang

doi:10.1109/ICSMC.2004.1398444

The second-price bidding system under uncertainty

Harunori Shishido, Dao Zhi Zeng, Xiaoguang Yang

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution

1 Citation (Scopus)

Abstract

The Japanese government uses bidding auction systems to assign public construction projects to firms. Although the first-price auction is applied in most cases, it is known that firms do not bid their reservation prices, which makes the game-theoretic analysis difficult. The second-price auction has many nice properties and is expected to be applied more. We first compare the optimal strategies of the government in both systems under certainty, and find that the expected payoffs to the government are the same. Then we generalize the second-price auction to the situation with uncertain factors. Our result shows that the bidders bid in the same way as the situation without uncertainty.

Original language	English
Title of host publication	2004 IEEE International Conference on Systems, Man and Cybernetics, SMC 2004
Pages	1056-1061
Number of pages	6
DOIs	https://doi.org/10.1109/ICSMC.2004.1398444
Publication status	Published - 2004 Dec 1
Externally published	Yes
Event	2004 IEEE International Conference on Systems, Man and Cybernetics, SMC 2004 - The Hague, Netherlands Duration: 2004 Oct 10 → 2004 Oct 13

Publication series

Name	Conference Proceedings - IEEE International Conference on Systems, Man and Cybernetics
Volume	1
ISSN (Print)	1062-922X

Other

Other	2004 IEEE International Conference on Systems, Man and Cybernetics, SMC 2004
Country/Territory	Netherlands
City	The Hague
Period	04/10/10 → 04/10/13

Keywords

Optimal bidding price
Second-price auction
Uncertainty

ASJC Scopus subject areas

Engineering(all)

Access to Document

10.1109/ICSMC.2004.1398444

Cite this

The second-price bidding system under uncertainty. / Shishido, Harunori; Zeng, Dao Zhi; Yang, Xiaoguang.
2004 IEEE International Conference on Systems, Man and Cybernetics, SMC 2004. 2004. p. 1056-1061 (Conference Proceedings - IEEE International Conference on Systems, Man and Cybernetics; Vol. 1).

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution

Shishido, H, Zeng, DZ & Yang, X 2004, The second-price bidding system under uncertainty. in 2004 IEEE International Conference on Systems, Man and Cybernetics, SMC 2004. Conference Proceedings - IEEE International Conference on Systems, Man and Cybernetics, vol. 1, pp. 1056-1061, 2004 IEEE International Conference on Systems, Man and Cybernetics, SMC 2004, The Hague, Netherlands, 04/10/10. https://doi.org/10.1109/ICSMC.2004.1398444

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title = "The second-price bidding system under uncertainty",

abstract = "The Japanese government uses bidding auction systems to assign public construction projects to firms. Although the first-price auction is applied in most cases, it is known that firms do not bid their reservation prices, which makes the game-theoretic analysis difficult. The second-price auction has many nice properties and is expected to be applied more. We first compare the optimal strategies of the government in both systems under certainty, and find that the expected payoffs to the government are the same. Then we generalize the second-price auction to the situation with uncertain factors. Our result shows that the bidders bid in the same way as the situation without uncertainty.",

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author = "Harunori Shishido and Zeng, {Dao Zhi} and Xiaoguang Yang",

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N2 - The Japanese government uses bidding auction systems to assign public construction projects to firms. Although the first-price auction is applied in most cases, it is known that firms do not bid their reservation prices, which makes the game-theoretic analysis difficult. The second-price auction has many nice properties and is expected to be applied more. We first compare the optimal strategies of the government in both systems under certainty, and find that the expected payoffs to the government are the same. Then we generalize the second-price auction to the situation with uncertain factors. Our result shows that the bidders bid in the same way as the situation without uncertainty.

AB - The Japanese government uses bidding auction systems to assign public construction projects to firms. Although the first-price auction is applied in most cases, it is known that firms do not bid their reservation prices, which makes the game-theoretic analysis difficult. The second-price auction has many nice properties and is expected to be applied more. We first compare the optimal strategies of the government in both systems under certainty, and find that the expected payoffs to the government are the same. Then we generalize the second-price auction to the situation with uncertain factors. Our result shows that the bidders bid in the same way as the situation without uncertainty.

KW - Optimal bidding price

KW - Second-price auction

KW - Uncertainty

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The second-price bidding system under uncertainty

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Keywords

ASJC Scopus subject areas

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