Algorithms for budgeted auctions and multi-agent covering problems

Abstract

In this thesis, we do an algorithmic study of optimization problems in budgeted auctions, and some well known covering problems in the multi-agent setting. We give new results for the design of approximation algorithms, online algorithms and hardness of approximation for these problems. Along the way we give new insights for many other related problems.

Budgeted Auction. We study the following allocation problem which arises in budgeted auctions (such as advertisement auctions run by Google, Microsoft, Yahoo! etc.) : Given a set of m indivisible items and n agents; agent i is willing to pay b[subscript ij] for item j and has an overall budget of B[subscript i] (i.e. the maximum total amount he is willing to pay). The goal is to allocate items to the agents so as to maximize the total revenue obtained.

We study the computation complexity of the above allocation problem, and give improved results for the approximation and the hardness of approximation. We also study the above allocation problem in an online setting. Online version of the problem has motivation in the sponsored search auctions which are run by search engines. Lastly, we propose a new bidding language for the budgeted auctions: decreasing bid curves with budget constraints. We make a case for why this language is better both for the sellers and for the buyers.

Multi-agent Covering Problems. To motivate this class of problems, consider the network design problem of constructing a spanning tree of a graph, assuming there are many agents willing to construct different parts of the tree. The cost of each agent for constructing a particular set of edges could be a complex function. For instance, some agents might provide discounts depending on how many edges they construct. The algorithmic question that one would be interested in is: Can we find a spanning tree of minimum cost in polynomial time in these complex settings? Note that such an algorithm will have to find a spanning tree, and partition its edges among the agents.

Above are the type of questions that we are trying to answer for various combinatorial problems. We look at the case when the agents' cost functions are submodular. These functions form a rich class and capture the natural properties of economies of scale or the law of diminishing returns.We study the following fundamental problems in this setting- Vertex Cover, Spanning Tree, Perfect Matching, Reverse Auctions. We look at both the single agent and the multi-agent case, and study the approximability of each of these problems.