Endogenous reference price auctions for a diverse set of commodities: an experimental analysis.

This paper is concerned with multi-object, multi-unit auctions with a budget constrained auctioneer who has noisy value estimates for each object. We propose a new allocation mechanism, the endogenous reference price auction, with two key features. First, bids are normalized across objects using "reference prices." Second, reference prices are set endogenously using information extracted from the bids submitted. We report on an experiment showing that a simple endogenous process mitigates value inaccuracies and improves three performance measures: the seller's profit, allocative efficiency and total surplus. These results have important implications for large auctions used in practice. Supplementary Information: The online version contains supplementary material available at 10.1007/s10683-022-09783-6.

The Nash equilibrium: a perspective.

In 1950, John Nash contributed a remarkable one-page PNAS article that defined and characterized a notion of equilibrium for n- person games. This notion, now called the "Nash equilibrium," has been widely applied and adapted in economics and other behavioral sciences. Indeed, game theory, with the Nash equilibrium as its centerpiece, is becoming the most prominent unifying theory of social science. In this perspective, we summarize the historical context and subsequent impact of Nash's contribution.