Path Auctions with Multiple Edge Ownership 1

In this paper, we study path auction games in which multiple edges may be owned by the same agent. The edge costs and the set of edges owned by the same agent are privately known to the owner of the edges. In this setting, we show that, assuming that edges not on the winning path always get 0 payment, there is no individually rational, strategyproof mechanism in which only edge costs are reported. If the agents are asked to report costs as well as identity information, we show that there is no Pareto efficient mechanism that is false-name proof. We then study a first-price path auction in this model. We show that, in the special case of parallel-path graphs, there is always a Pareto efficient pure strategy 2-Nash equilibrium in bids. However, this result does not extend to general graphs: we construct a graph in which there is no Pareto efficient pure strategy 2-Nash equilibrium.