Using Analytic Network Process Model in Combinatorial Auctions

Auctions are important market mechanisms for the allocation of goods and services. Auctions are preferred often to other common processes because they are open, quite fair, easiness to understand by participants, and lead to economically efficient outcomes. Design of auctions is a multidisciplinary effort made of contributions from economics, operations research, informatics, and other disciplines. Combinatorial auctions are those auctions in which bidders can place bids on combinations of items, called “packages,” rather than just individual items. The advantage of combinatorial auctions is that the bidder can more fully express his preferences. This is particular important when items are complements. The multiple evaluation criteria can be used. There are dependencies among sellers, buyers, criteria, bundles of items. A variety of feedback processes creates complex system of items. For the whole structure seems to be very appropriate Analytic Network Process (ANP) approach. The ANP method makes possible to deal systematically with all kinds of dependence and feedback in the system of items. By the ANP approach can be evaluated the preferences of bundles of items. Dynamic Network Process (DNP) as an extension of ANP can deal with time dependent priorities in combinatorial auctions.