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Article: Truthful auctions for e-market logistics services procurement with quantity discounts

TitleTruthful auctions for e-market logistics services procurement with quantity discounts
Authors
KeywordsQuantity discount
Cooperative procurement
Truthful double-auction
Mechanism design
Issue Date2020
PublisherPergamon. The Journal's web site is located at http://www.elsevier.com/locate/trb
Citation
Transportation Research Part B: Methodological, 2020, v. 133, p. 165-180 How to Cite?
AbstractAuctions are an important method for solving the logistics procurement problem in electronics markets. However, current auction methods rarely consider the existence of quantity discounts. To fill this research gap, we introduce quantity discounts into the procurement Vickrey–Clark–Groves (P-VCG) and truthful double-auction mechanisms and apply them to the logistics services procurement market. For a market with only one customer, we design a P-VCG auction with quantity discounts, and for a market with multiple customers, we construct a model for maximizing social welfare and propose a trade reduction with a quantity discount (TR-QD) double-auction mechanisms. We prove that both auction mechanisms ensure incentive compatibility, individual rationality, balanced budget, and asymptotical efficiency. Furthermore, compared with traditional truthful double-auctions, the TR-QD mechanism supports cooperative purchases—which allows more customers to enjoy discounts on large-scale logistics services—and bid time priority—which achieves the goal of meeting earlier requests earlier and improves auction efficiency. Numerical studies further show that the TR-QD auction mechanism can achieve an increase in customers’ total value, logistics companies’ total value, social welfare and total trading volume.
Persistent Identifierhttp://hdl.handle.net/10722/287355
ISSN
2019 Impact Factor: 4.796
2015 SCImago Journal Rankings: 3.905

 

DC FieldValueLanguage
dc.contributor.authorLiang, R-
dc.contributor.authorWang, J-
dc.contributor.authorHuang, M-
dc.contributor.authorJiang, ZZ-
dc.date.accessioned2020-09-22T02:59:47Z-
dc.date.available2020-09-22T02:59:47Z-
dc.date.issued2020-
dc.identifier.citationTransportation Research Part B: Methodological, 2020, v. 133, p. 165-180-
dc.identifier.issn0191-2615-
dc.identifier.urihttp://hdl.handle.net/10722/287355-
dc.description.abstractAuctions are an important method for solving the logistics procurement problem in electronics markets. However, current auction methods rarely consider the existence of quantity discounts. To fill this research gap, we introduce quantity discounts into the procurement Vickrey–Clark–Groves (P-VCG) and truthful double-auction mechanisms and apply them to the logistics services procurement market. For a market with only one customer, we design a P-VCG auction with quantity discounts, and for a market with multiple customers, we construct a model for maximizing social welfare and propose a trade reduction with a quantity discount (TR-QD) double-auction mechanisms. We prove that both auction mechanisms ensure incentive compatibility, individual rationality, balanced budget, and asymptotical efficiency. Furthermore, compared with traditional truthful double-auctions, the TR-QD mechanism supports cooperative purchases—which allows more customers to enjoy discounts on large-scale logistics services—and bid time priority—which achieves the goal of meeting earlier requests earlier and improves auction efficiency. Numerical studies further show that the TR-QD auction mechanism can achieve an increase in customers’ total value, logistics companies’ total value, social welfare and total trading volume.-
dc.languageeng-
dc.publisherPergamon. The Journal's web site is located at http://www.elsevier.com/locate/trb-
dc.relation.ispartofTransportation Research Part B: Methodological-
dc.subjectQuantity discount-
dc.subjectCooperative procurement-
dc.subjectTruthful double-auction-
dc.subjectMechanism design-
dc.titleTruthful auctions for e-market logistics services procurement with quantity discounts-
dc.typeArticle-
dc.identifier.emailWang, J: jwwang@hku.hk-
dc.identifier.authorityWang, J=rp01888-
dc.description.naturelink_to_subscribed_fulltext-
dc.identifier.doi10.1016/j.trb.2020.01.002-
dc.identifier.scopuseid_2-s2.0-85078212306-
dc.identifier.hkuros314570-
dc.identifier.volume133-
dc.identifier.spage165-
dc.identifier.epage180-
dc.publisher.placeUnited Kingdom-

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