Combinatorial auctions via posted prices

Michal Feldman, Nick Gravin, Brendan Lucier

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review


We study anonymous posted price mechanisms for combinatorial auctions in a Bayesian framework. In a posted price mechanism, item prices are posted, then the consumers approach the seller sequentially in an arbitrary order, each purchasing her favorite bundle from among the unsold items at the posted prices. These mechanisms are simple, transparent and trivially dominant strategy incentive compatible (DSIC). We show that when agent preferences are fractionally subadditive (which includes all submodular functions), there always exist prices that, in expectation, obtain at least half of the optimal welfare. Our result is constructive: given black-box access to a combinatorial auction algorithm A, sample access to the prior distribution, and appropriate query access to the sampled valuations, one can compute, in polytime, prices that guarantee at least half of the expected welfare of A. As a corollary, we obtain the first polytime (in n and m) constant-factor DSIC mechanism for Bayesian submodular combinatorial auctions, given access to demand query oracles. Our results also extend to valuations with complements, where the approximation factor degrades linearly with the level of complementarity.

Original languageEnglish
Title of host publicationProceedings of the 26th Annual ACM-SIAM Symposium on Discrete Algorithms, SODA 2015
Number of pages13
ISBN (Electronic)9781611973747
StatePublished - 2015
Event26th Annual ACM-SIAM Symposium on Discrete Algorithms, SODA 2015 - San Diego, United States
Duration: 4 Jan 20156 Jan 2015

Publication series

NameProceedings of the Annual ACM-SIAM Symposium on Discrete Algorithms


Conference26th Annual ACM-SIAM Symposium on Discrete Algorithms, SODA 2015
Country/TerritoryUnited States
CitySan Diego

All Science Journal Classification (ASJC) codes

  • Software
  • Mathematics(all)


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