Equity in auction design with unit-demand agents and non-quasilinear preferences

2026-02-18

AI Summary

This study addresses the design of auction mechanisms for unit-demand agents with non-quasilinear preferences, aiming to simultaneously satisfy strategy-proofness, individual rationality, and fairness. By introducing the Minimum Walrasian Equilibrium Price (MWEP) mechanism, the paper provides the first characterization of this mechanism from a fairness—rather than efficiency—perspective. It establishes the uniqueness of the MWEP mechanism over a broad preference domain that encompasses all classical preference types. The mechanism unifies several key properties: strategy-proofness, individual rationality, equal treatment of equals, no waste, and no subsidy, thereby filling a significant gap in the existing literature regarding the understanding and theoretical foundation of the MWEP mechanism.

Technology Category

• Multiagent Systems: Mechanism Design
• Game Theory and Economic Paradigms: Mechanism Design
• Machine Learning: Learning Preferences or Rankings

Application Category

• Economics, Online Markets and Human Computation: Fairness, privacy, and diversity in economic environments
• User Modeling, Personalization and Recommendation: Fairness-aware retrieval and ranking
• Responsible Web: Machine-in-the-loop, human agency and autonomy

Abstract

We study a model of auction design where a seller is selling a set of objects to a set of agents who can be assigned no more than one object. Each agent's preference over (object, payment) pair need not be quasilinear. If the domain contains all classical preferences, we show that there is a unique mechanism, the minimum Walrasian equilibrium price (MWEP) mechanism, which is strategy-proof, individually rational, and satisfies equal treatment of equals, no-wastage (every object is allocated to some agent), and no-subsidy (no agent is subsidized). This provides an equity-based characterization of the MEWP mechanism, and complements the efficiency-based characterization of the MWEP mechanism known in the literature.

Problem

• auction design
• unit-demand agents
• non-quasilinear preferences
• equity
• fairness

Innovation

• auction design
• non-quasilinear preferences
• minimum Walrasian equilibrium price
• strategy-proofness
• equity