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Do core-selecting Combinatorial Clock Auctions always lead to high efficiency? An experimental analysis of spectrum auction designs

Published online by Cambridge University Press:  14 March 2025

Martin Bichler ,
Pasha Shabalin  and
Jürgen Wolf
Martin Bichler*
Affiliation:
Department of Informatics, Technische Universität München, Boltzmannstr. 3, 85748 Garching, Germany
Pasha Shabalin*
Affiliation:
Department of Informatics, Technische Universität München, Boltzmannstr. 3, 85748 Garching, Germany
Jürgen Wolf*
Affiliation:
Department of Informatics, Technische Universität München, Boltzmannstr. 3, 85748 Garching, Germany
*
e-mail: bichler@in.tum.de
e-mail: shabalin@in.tum.de
e-mail: wolf@in.tum.de
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Abstract

For many years the Simultaneous Multi-Round Auction (SMRA) has been the primary auction design for spectrum sales worldwide. Recently, the core-selecting Combinatorial Clock Auction (CCA) has been used as an alternative to the SMRA in a number of countries promising strong incentives for truthful bidding and high efficiency as a result. We analyze the efficiency and auctioneer revenue of the CCA in comparison to SMRA and examine bidding behavior in both formats. The experiments are based on two value models, which resemble single- and multiband spectrum sales in the field. Such applications often allow for thousands of possible bundles. Bidders in the CCA submitted bids for only a fraction of all bundles with a positive valuation. Bundles were selected based on synergies and payoff after the primary bid rounds. As a consequence, we found efficiency of the CCA to be significantly lower than that of SMRA in the multi-band value model and auctioneer revenue of the CCA to be lower in both value models. In addition, we characterize several properties of the auction format, which result from the two-stage design and the payment and activity rules.

Keywords

AuctionsLab experimentsGroup behaviorIndividual behavior

JEL classification

D44: Auctions C91: Laboratory, Individual Behavior C92: Laboratory, Group Behavior

Information

Type
Original Paper
Information
Experimental Economics , Volume 16 , Issue 4 , December 2013 , pp. 511 - 545
Copyright
Copyright © 2013 Economic Science Association

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