General auction mechanism for search advertising

In sponsored search, a number of advertising slots is available on a search results page, and have to be allocated among a set of advertisers competing to display an ad on the page. This gives rise to a bipartite matching market that is typically cleared by the way of an automated auction. Several auction mechanisms have been proposed, with variants of the Generalized Second Price (GSP) being widely used in practice. There is a rich body of work on bipartite matching markets that builds upon the stable marriage model of Gale and Shapley and the assignment model of Shapley and Shubik. This line of research offers deep insights into the structure of stable outcomes in such markets and their incentive properties. In this paper, we model advertising auctions in terms of an assignment model with linear utilities, extended with bidder and item specific maximum and minimum prices. Auction mechanisms like the commonly used GSP or the well-known Vickrey-Clarke-Groves (VCG) can be interpreted a...

• Type: Conference
• Year: 2009
• Where: WWW
• Authors: Dávid Pál, Gagan Aggarwal, Martin Pál, S. Muthukrishnan
• Keywords: Bidder-optimal Stable Matching, Bipartite Matching Markets, Internet Technology, Stable Marriage Model, WWW 2009