Order Auctions with Private Position Preferences

Ruijie Wang; Aviv Yaish

Paper 2026/1580

Order Auctions with Private Position Preferences

Ruijie Wang

, University of Michigan–Ann Arbor

Aviv Yaish

, Yale University, IC3

Abstract

We study auctions where two positions are sold to unit-demand bidders with private heterogeneous order preferences: some are specialists who value only the first position, while others are generalists indifferent between the two. First, we consider a first-price rule which allocates the first and second items to the highest and second-highest bidders, respectively. We show that no strategy profile ex-post implements the efficient allocation at every type profile, irrespective of payments, and provide a distribution-free equilibrium welfare guarantee of 1/2. To augment this result, we prove that for deterministic one-round auctions and discrete bids, the efficient allocation requires each bidder to communicate at least one bit more than its bid's binary representation. We next ask what the same bit accomplishes in winner-pays-bid formats where bidders can also specify specific item preferences. In particular, we show that this strengthens our distribution-free equilibrium welfare guarantee to 1-1/e. Finally, we discuss the applicability to priority service, blockchain transaction ordering, and cloud compute and artificial intelligence (AI) marketplaces.

Metadata

Available format(s): PDF
Category: Applications
Publication info: Preprint.
Keywords: Blockchains Artificial Intelligence Marketplaces Priority Service
Contact author(s): wruijie @ umich edu
a @ yai sh
History: 2026-08-05: last of 3 revisions; 2026-08-02: received; See all versions
Short URL: https://ia.cr/2026/1580
License: CC BY

BibTeX

@misc{cryptoeprint:2026/1580,
      author = {Ruijie Wang and Aviv Yaish},
      title = {Order Auctions with Private Position Preferences},
      howpublished = {Cryptology {ePrint} Archive, Paper 2026/1580},
      year = {2026},
      url = {https://eprint.iacr.org/2026/1580}
}