Computer Science – Data Structures and Algorithms
Scientific paper
2009-08-19
Computer Science
Data Structures and Algorithms
Full version of ESA 2009 paper, 23 pages
Scientific paper
Most recent papers addressing the algorithmic problem of allocating advertisement space for keywords in sponsored search auctions assume that pricing is done via a first-price auction, which does not realistically model the Generalized Second Price (GSP) auction used in practice. Towards the goal of more realistically modeling these auctions, we introduce the Second-Price Ad Auctions problem, in which bidders' payments are determined by the GSP mechanism. We show that the complexity of the Second-Price Ad Auctions problem is quite different than that of the more studied First-Price Ad Auctions problem. First, unlike the first-price variant, for which small constant-factor approximations are known, it is NP-hard to approximate the Second-Price Ad Auctions problem to any non-trivial factor. Second, this discrepancy extends even to the 0-1 special case that we call the Second-Price Matching problem (2PM). In particular, offline 2PM is APX-hard, and for online 2PM there is no deterministic algorithm achieving a non-trivial competitive ratio and no randomized algorithm achieving a competitive ratio better than 2. This stands in contrast to the results for the analogous special case in the first-price model, the standard bipartite matching problem, which is solvable in polynomial time and which has deterministic and randomized online algorithms achieving better competitive ratios. On the positive side, we provide a 2-approximation for offline 2PM and a 5.083-competitive randomized algorithm for online 2PM. The latter result makes use of a new generalization of a classic result on the performance of the "Ranking" algorithm for online bipartite matching.
Azar Yossi
Birnbaum Benjamin
Karlin Anna R.
Nguyen Thach C.
No associations
LandOfFree
On Revenue Maximization in Second-Price Ad Auctions does not yet have a rating. At this time, there are no reviews or comments for this scientific paper.
If you have personal experience with On Revenue Maximization in Second-Price Ad Auctions, we encourage you to share that experience with our LandOfFree.com community. Your opinion is very important and On Revenue Maximization in Second-Price Ad Auctions will most certainly appreciate the feedback.
Profile ID: LFWR-SCP-O-525624