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UID:/NewsandEvents/Archives/2010/newsitem/3687/10-
December-2010-Discrete-Strategies-in-Keyword-Aucti
ons-and-their-Social-Inefficiency-Orestis-Telelis-
U-Liverpool-UK-
DTSTAMP:20101128T000000
SUMMARY:Discrete Strategies in Keyword Auctions an
d their Social Inefficiency, Orestis Telelis (U Li
verpool, UK)
ATTENDEE;ROLE=Speaker:Orestis Telelis (U Liverpool
, UK)
DTSTART;TZID=Europe/Amsterdam:20101210T110000
DTEND;TZID=Europe/Amsterdam:20101210T000000
LOCATION:room L016, CWI, Science Park 123, Amsterd
am
DESCRIPTION:We study formally discrete bidding str
ategies for the game induced by the Generalized Se
cond Price (GSP) keyword auction mechanism. Such s
trategies have seen experimental evaluation in the
recent literature within iterative best response
procedures, which have been shown not to converge.
We give a detailed definition of iterative best
response under these strategies and, under approp
riate discretization of the players' strategy spac
es we find that the discretized configurations spa
ce contains socially optimal pure Nash equilibria.
We cast discrete strategies under a new light, by
studying their performance for bidders that act b
ased on local information; we prove bounds for the
worst-case ratio of the social welfare of locally
stable configurations, relative to the socially o
ptimum welfare. Finally we discuss open problems r
egarding convergence of discrete strategies and th
e social welfare of stable configurations for Keyw
ord Auctions under the GSP mechanism. For more in
formation, contact k.r.apt at cwi.nl
X-ALT-DESC;FMTTYPE=text/html:\n We study
formally discrete bidding strategies for the game
\n induced by the Generalized Second Price
(GSP) keyword auction\n mechanism. Such str
ategies have seen experimental evaluation\n
in the recent literature within iterative best re
sponse\n procedures, which have been shown
not to converge.\n

\n We give
a detailed definition of iterative best response\
n under these strategies and, under appropr
iate discretization\n of the players' strat
egy spaces we find that the\n discretized c
onfigurations space contains socially optimal\n
pure Nash equilibria. We cast discrete strate
gies under a new\n light, by studying their
performance for bidders that act\n based o
n local information; we prove bounds for the worst
-case\n ratio of the social welfare of loca
lly stable configurations,\n relative to th
e socially optimum welfare. Finally we discuss\n
open problems regarding convergence of discr
ete strategies and\n the social welfare of
stable configurations for Keyword\n Auction
s under the GSP mechanism.

\n \n F
or more information, contact k.r.
apt at cwi.nl

\n
URL:/NewsandEvents/Archives/2010/newsitem/3687/10-
December-2010-Discrete-Strategies-in-Keyword-Aucti
ons-and-their-Social-Inefficiency-Orestis-Telelis-
U-Liverpool-UK-
END:VEVENT
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