<p>Joint information blocking is the strategic behavior of a group of buyers that blocks competitors’ information. In the framework of diffusion auctions, joint information blocking employed by buyers’ tacit collusion can avoid competitive bidding, which leads to inefficiency of the auction mechanism. In this paper, blocking-proofness is introduced and investigated. Blocking-proofness means that buyers cannot benefit from joint information blocking, that is, from deleting diffusion relations to other buyers in the network. It is shown that blocking-proofness and incentive compatibility are independent, and both are necessary conditions for collusion-proofness. Finally, the blocking-proof diffusion auctions with monotonic allocation policies are fully characterized, and the independence of the conditions is discussed.</p>

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How to prevent joint information blocking: A study of blocking-proof diffusion auctions

  • Xindi Bai,
  • Genjiu Xu,
  • Wenzhong Li

摘要

Joint information blocking is the strategic behavior of a group of buyers that blocks competitors’ information. In the framework of diffusion auctions, joint information blocking employed by buyers’ tacit collusion can avoid competitive bidding, which leads to inefficiency of the auction mechanism. In this paper, blocking-proofness is introduced and investigated. Blocking-proofness means that buyers cannot benefit from joint information blocking, that is, from deleting diffusion relations to other buyers in the network. It is shown that blocking-proofness and incentive compatibility are independent, and both are necessary conditions for collusion-proofness. Finally, the blocking-proof diffusion auctions with monotonic allocation policies are fully characterized, and the independence of the conditions is discussed.