Spiteful bidding in the dollar auction

Marcin Waniek, Agata Niescieruk, Tomasz Michalak, Talal Rahwan

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

Shubik's (all-pay) dollar auction is a simple yet powerful auction model that aims to shed light on the motives and dynamics of conflict escalation. Common intuition and experimental results suggest that the dollar auction is a trap, inducing conflict by its very design. However, O'Neill [1986] proved the surprising fact that, contrary to the experimental results and the intuition, the dollar auction has an immediate solution in pure strategies, i.e., theoretically it should not lead to conflict escalation. In this paper, inspired by the recent literature on spiteful bidders, we ask whether the escalation in the dollar auction can be induced by meanness. Our results confirm this conjecture in various scenarios.

Original languageEnglish (US)
Title of host publicationIJCAI 2015 - Proceedings of the 24th International Joint Conference on Artificial Intelligence
EditorsMichael Wooldridge, Qiang Yang
PublisherInternational Joint Conferences on Artificial Intelligence
Pages667-673
Number of pages7
ISBN (Electronic)9781577357384
StatePublished - 2015
Event24th International Joint Conference on Artificial Intelligence, IJCAI 2015 - Buenos Aires, Argentina
Duration: Jul 25 2015Jul 31 2015

Publication series

NameIJCAI International Joint Conference on Artificial Intelligence
Volume2015-January
ISSN (Print)1045-0823

Other

Other24th International Joint Conference on Artificial Intelligence, IJCAI 2015
CountryArgentina
CityBuenos Aires
Period7/25/157/31/15

ASJC Scopus subject areas

  • Artificial Intelligence

Cite this

Waniek, M., Niescieruk, A., Michalak, T., & Rahwan, T. (2015). Spiteful bidding in the dollar auction. In M. Wooldridge, & Q. Yang (Eds.), IJCAI 2015 - Proceedings of the 24th International Joint Conference on Artificial Intelligence (pp. 667-673). (IJCAI International Joint Conference on Artificial Intelligence; Vol. 2015-January). International Joint Conferences on Artificial Intelligence.