
Vickrey–Clarke–Groves Auction - dedalus
https://en.wikipedia.org/wiki/Vickrey%E2%80%93Clarke%E2%80%93Groves_auction
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denormalfloat
This seems needlessly complex. Aside from being an interesting thought
experiment, what is the practicality of this style auction?

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whymauri
The highest bidder pays the second highest bid. Generalized, the k-th highest
bidder pays the (k-1)-th bid for some k-th item.

It enforces truthful bidding and is revenue optimal. How is it needlessly
complex?

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doctorpangloss
While revenue optimal, growth in retail is eventually driven by psychology,
not pricing, since if there’s anything our real economy is good at producing,
it’s morons.

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whymauri
That's the Bulow-Klemperer theorem. You would rather have more growth
(bidders) at the expense of an optimal bidding mechanism.

