# Mechanisms for combinatorial auctions with budget constraints

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## Abstract

This paper studies combinatorial auctions with budget-constrained bidders from a mechanism design perspective. I search for mechanisms that are incentive compatible, individually rational, symmetric, non-wasteful and non-bossy. First focusing on the greedy domain, in which any increase in a bidder’s valuation always exceeds his budget, I derive the unique mechanism, called the Iterative Second Price Auction. For the general domain, however, no such mechanism exists.

### Keywords

Combinatorial auctions Budget constraints Mechanisms### JEL Classification

D44 D82## Notes

### Acknowledgments

I want to thank Fuhito Kojima, Ilya Segal, Alex Wolitzky and Gabriel Carroll for their helpful comments on a version of this paper that was in my dissertation at Stanford University, and am grateful to two anonymous referees for their insightful comments.

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