Item Pricing for Combinatorial Public Projects

Conference paper
Part of the Lecture Notes in Computer Science book series (LNCS, volume 9778)

Abstract

We describe and analyze a simple mechanism for the Combinatorial Public Project Problem (Cppp), a prototypical abstract model for decision making by autonomous strategic agents. The problem asks for the selection of k out of m available items, so that the social welfare is maximized. With respect to truthful Mechanism Design, the Cppp has been shown to suffer from limited computationally tractable approximability. Instead, we study a non-truthful Item Bidding mechanism, which elicits the agents’ preferences through separate bids on the items and selects the k items with the highest sums of bids. We pair this outcome determination rule with a payment scheme that determines – for each agent – a separate price for each item in the outcome. For expressive classes of the agents’ valuation functions, we establish existence of welfare-optimal pure Nash equilibria and strong equilibria. Subsequently, we derive worst-case upper and lower bounds on the approximation of the optimal welfare achieved at strong equilibrium, and at (mixed) Bayes-Nash equilibrium, under an incomplete information setting. The mechanism retains good stability properties and favors an advantage compared to recent related approaches, given its simple per-item bidding and pricing rules, and its comparable performance with respect to welfare approximation.

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Copyright information

© Springer International Publishing Switzerland 2016

Authors and Affiliations

  1. 1.Department of InformaticsAthens University of Economics and BusinessAthensGreece
  2. 2.Department of Digital SystemsUniversity of PiraeusPiraeusGreece

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