Winner Determination Algorithms for Electronic Auctions: A Framework Design

Abstract

During the past few years, auctions have become popular in conducting trade negotiations on the Internet. The design of new auctions and other negotiation protocols has become an important topic for both, industry and academia. Traditional auction mechanisms allow price-only negotiations for which the winner determination is a computationally simple task. However, the need for new auction mechanisms that allow complex bids such as bundle bids and multi-attribute bids has been raised in many situations. The winner determination in these auctions is a computationally hard problem. The computational complexity has been a significant hurdle for the widespread use of these advanced auction models. In this paper, we will outline the auction design space and classify resource allocation algorithms along multiple dimensions. Then, we will explain the design of an object framework providing an API to different types of winner determination algorithms. This framework enables application programmers to specify buyer preferences, allocation rules and supplier offerings in a declarative manner, and solve the allocation problems without having to re-implement the computationally complex algorithms.