Secure combinatorial auctions by dynamic programming with polynomial secret sharing

Abstract

Combinatorial auctions have recently attracted the interests of many researchers due to their promising applications such as the spectrum auctions recently held by the FCC. In a combinatorial auction, multiple items with interdependent values are sold simultaneously and bidders are allowed to bid on any combination of items. This paper presents a method for implementing several secure combinatorial auction protocols based on our newly developed secure dynamic programming protocol. Dynamic programming is a very effective, widely used technique for tackhng vaxious combinatorial optimization problems, including several types of combinatorial auctions. Our secure dynamic programming protocol utilizes secret sharing techniques and can obtain the optimal solution of a combinatorial optimization problem, i.e., result of a combinatorial auction, without revealing the inputs of the problem, i.e., bidding prices. We discuss the application of the method to several combinatorial auctions, i.e., multiple-unit singleitem auctions, linear-goods auctions, and general combinatorial auctions.