Dengji ZHAO - Intelligent Systems Lab, University of Western Sydney - IRIT UT1


Online Mechanism Design

This talk will first give a brief introduction of mechanism design in both static and dynamic fashion, then focus on a mechanism we studied for double auction and some directions we are working on. A mechanism is a specification of how economic decisions are determined as a function of the information that is known by the individuals in the economy, e.g. english auction, stock exchange markets. Mechanism Design is the discipline of designing such functions/rules that lead to socially desirable outcomes in a context where individuals are selfish and hold private information. The main question asked in mechanism design is how to design mechanisms to extract all truthful private information of the participants/traders/agents. Traditionally, mechanism design has focused on a static setting where there is no uncertainty and mostly just a single decision to be made for the mechanism. But many real environments are dynamic, e.g. stock exchange markets, eBay, Ad Auctions, and multi-agent systems, and the solutions of static mechanism design are insufficient in these settings. To see the main difference between mechanism design in static environments and that in dynamic environments, you can think it as to design sorting functions for two different ways of inputs: one is that all elements/inputs are available before the sorting function start, and the other is that elements are come one by one and the sorting function has to give an element the final position before the arrival of the next.