How to Design Simple Efficient Mechanisms that are also Composable

Monday, November 19, 2012 -
4:30pm to 5:30pm
E-commerce applications require simple, and well-designed systems, and systems that work well even if users participate in multiple mechanisms (and the value of each player overall is a complex function of their outcomes). Traditional mechanism design has considered such mechanisms only in isolation, and the mechanisms it proposes tend to be complex and impractical. In contrast, players typically participate in various mechanisms, mechanisms that are run by different principals (e.g. different sellers on eBay or different ad-exchange platforms) and coordinating them to run a single combined mechanism is infeasible or impractical. Even the simple and elegant Vickrey auction loses some of its appeal when not in isolation: when the overall value of each player is a complex function of their outcomes, the global mechanism is no longer truthful. In this talk we initiate the study of efficient mechanism design with guaranteed good properties even when players participate in multiple different mechanisms either simultaneously or sequentially. Over the last decade, computer scientists and game theorists have developed good understanding of the impact of strategic user behavior on system performance in environments that include selfish traffic routing, service location, and bandwidth sharing. We will consider simple mechanisms from this perspective. We define smooth mechanisms (that can be thought of as mechanisms that generate approximately market clearing prices), and show that smooth mechanisms are approximately efficient, and the efficiency guarantees for smooth mechanisms (when studied in isolation) carry over to the same or approximately the same guarantees for a market composed of such mechanisms. Joint work with Vasilis Syrgkanis.
Eva Tardos
Cornell University
Event Location: 
105 Computer Science