Bundle Design in Robust Combinatorial Auction Protocol against False-name Bids
Makoto Yokoo, Yuko Sakurai, and Shigeo Matsubara
17th International Joint Conference on Artificial Intelligence (IJCAI-2001),2001.

This paper presents a method for designing bundles in a combinatorial auction protocol that is robust against false-name bids. Internet auctions have become an integral part of Electronic Commerce and a promising field for applying AI technologies. However, the possibility of a new type of cheating called a false-name bid, i.e., a bid submitted under a fictitious name, has been pointed out.

A protocol called Leveled Division Set (LDS) protocol that is robust against false-name bids has been developed. However, this protocol requires the auctioneer to define a leveled division set. A leveled division set is a series of division sets, where a division set is a set of divisions and a division is a combination of bundles of goods. We need to solve a very complicated optimization problem to construct a leveled division set in order to obtain a good social surplus.

We have developed a heuristic method for overcoming this problem. In this method, we first find a good division with a winner determination algorithm, and then construct a leveled division set by using this division as a seed. Through a simulation, we show that our method can obtain a social surplus that is very close to optimal.