Last lecture we discussed two simple auction scenarios — identical items with unit-demand bidders, and non-identical items with bidders with additive valuations. In both scenarios, we gave an ascending auction that is ex post incentive compatible (EPIC) — meaning sincere bidding by every bidder is an ex post Nash equilibrium (EPNE) with guaranteed non-negative utility — and that maximizes the w...

This paper proposes an economic dispatch strategy for the electricity system with one generation company, multiple utility companies and multiple consumers, which participate in demand response to keep the electricity real-time balance. In the wholesale markets, multiple utility companies will commonly select a reliable agent to negotiate with the generation company on the wholesale price. It i...

An iterative algorithm is proposed and tested in Cournot Game models, which is based on the convergence of sequential best responses and the utilization of a genetic algorithm for determining each player’s best response to a given strategy profile of its opponents. An extra outer loop is used, to address the problem of finite accuracy, which is inherent in genetic algorithms, since the set of f...

This study is the first to attempt to isolate a relationship between cognitive activity and equilibration to a Nash Equilibrium. Subjects, while undergoing fMRI scans of brain activity, participated in second price auctions against a single competitor following predetermined strategy that was unknown to the subject. For this auction there is a unique strategy that will maximize the subjects’ ea...

Player i has valuation vi and vi > vi+1 > 0. The set of actions for each player is a bid bi ∈ [0,∞]. The price paid for the item is p = maxi{bi} and the player of minimum index bidding this price wins. The payoff for player i is vi − p if i wins, 0 else. A Nash equilibrium is denoted b∗ = {bi }. If b∗ is a Nash equilibrium, then player 1 wins. Suppose I have a strategy, that is, a vector of bid...

Research Article Linjing Li State Key Laboratory of Management and Control for Complex Systems, China [email protected] Daniel Zeng State Key Laboratory of Management and Control for Complex Systems, China [email protected] Huimin Zhao University of Wisconsin-Milwaukee [email protected] Despite the tremendous commercial success of generalized second-price (GSP) keyword auctions, it still remain...

We develop game theoretic models to evaluate strategic behavior in deregulated electricity markets, with particular attention given to the market rules in place in California through the summer of 2000. We prove existence of a Nash equilibrium under two particular sets of market rules used by the CALPX and CAISO respectively. Next we derive a lower bound (strictly above marginal cost) on averag...

Electricity market plays an important role in improving the economics of electrical power system. Transmission network is vital entity in open access deregulated wholesale electricity market. Whenever transmission network congestion occurs in electricity market, it divides the market in different zones and the trading price of electricity will no longer remains the same for the whole system. Bi...

in the restructured environment of electricity market, firstly the generating companies and the customers are looking for maximizing their profit and secondly independent system operator is looking for the stability of the power network and maximizing social welfare. in this paper, a one way auction in the electricity market for the generator companies is considered in both perfect and imperfec...

We present a polynomial-time algorithm that always finds an (approximate) Nash equilibrium for repeated two-player stochastic games. The algorithm exploits the folk theorem to derive a strategy profile that forms an equilibrium by buttressing mutually beneficial behavior with threats, where possible. One component of our algorithm efficiently searches for an approximation of the egalitarian poi...