On bidding for a fixed number of items in a sequence of auctions

Michael Katehakis, Kartikeya S. Puranam

Research output: Contribution to journalArticlepeer-review

9 Scopus citations

Abstract

We consider the problem of a firm ("the buyer") that must acquire a fixed number (L) of items. The buyer can acquire these items either at a fixed buy-it-now price in the open market or by participating in a sequence of N > L auctions. The objective of the buyer is to minimize his expected total cost for acquiring all L items. We model this problem as a Markov Decision Process and establish monotonicity properties for the optimal value function and the optimal bidding strategies.

Original languageEnglish (US)
Pages (from-to)76-84
Number of pages9
JournalEuropean Journal of Operational Research
Volume222
Issue number1
DOIs
StatePublished - Oct 1 2012

All Science Journal Classification (ASJC) codes

  • Modeling and Simulation
  • Management Science and Operations Research
  • Information Systems and Management

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