We study correlated equilibria and coarse equilibria of simple first-price single-item auctions in the simplest auction model of full information. Nash equilibria are known to always yield full efficiency and a revenue that is at least the second-highest value. We prove that the same is true for all correlated equilibria, even those in which agents overbid – i.e., bid above their values. Coarse equilibria, in contrast, may yield lower efficiency and revenue. We show that the revenue can be as low as 26% of the second-highest value in a coarse equilibrium, even if agents are assumed not to overbid, and this is tight. We also show that when players do not overbid, the worst-case bound on social welfare at coarse equilibrium improves from 63% of the highest value to 81%, and this bound is tight as well.
CITATION STYLE
Feldman, M., Lucier, B., & Nisan, N. (2016). Correlated and coarse equilibria of single-item auctions. In Lecture Notes in Computer Science (including subseries Lecture Notes in Artificial Intelligence and Lecture Notes in Bioinformatics) (Vol. 10123 LNCS, pp. 131–144). Springer Verlag. https://doi.org/10.1007/978-3-662-54110-4_10
Mendeley helps you to discover research relevant for your work.