Publications and Research

Document Type

Article

Publication Date

5-2006

Abstract

Auction mechanism design is a subfield of game theory dedicated to manipulating the rules of an auction so as to achieve specific goals. The complexity of the dynamics of auctions, especially continuous double auctions, makes it difficult to apply the usual analytic game-theoretic methods. This paper takes an experimental approach, searching a parameterized space of possible auction types, and presents a new pricing policy for continuous double auctions. The paper further demonstrates how this policy, together with a shout improvement rule, helps to reduce the fluctuation of transaction prices in auctions involving agents with minimum intelligence while keeping the overall efficiency high.

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