Problem 1 (The Third Price Auction). Show that if the seller is indifferent about the identity of the bidders who acquire the items, then the
Problem 1 (The Third Price Auction). Show that if the seller is indifferent about the identity of the bidders who acquire the items, then the VCG pivot mechanism, as described by our general formula, is the third price auction. That is, it is an auction in which the items are assigned to the two highest bidders and the price is equal to the third highest bid.
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Authors: Warren, Reeve, Duchac
12th Edition
1133952410, 9781133952411, 978-1133952428
