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Abstract Bioenergy with carbon capture and storage (BECCS) is considered as a future key technology to provide baseload electricity, heat, pulp, paper, and biofuels, while also enabling atmospheric carbon dioxide removal (CDR). Sweden seeks to lead the way in bringing this technology up to scale, introducing a EUR 3.6 billion reverse auction scheme to facilitate market entry of companies producing BECCS. We explore instrument design preferences among politicians, regulators, and prospective BECCS operators to identify trade-offs and explore feasible policy design. Based on 35 interviews with experts in the latent BECCS sector in Sweden, we identify under which circumstances prospective operators would be willing to place bids and discuss how actor preferences both align with and challenge auction theory. The analysis concludes that at least four dilemmas need attention. These concerns how to: (1) balance the state’s demand for BECCS to be implemented already in 2030 against the prospective BECCS operators’ fear of the winner’s curse, i.e., a fear of bidding for a contract that turns out to be too costly to implement; (2) allocate contracts at the margin of the auctioneer’s demand for BECCS without driving up costs; (3) design compliance mechanism to achieve effectiveness without undermining efficiency, and; 4) integrate the auction with the voluntary carbon market—if at all—in a manner that safeguards the environmental integrity of the auctions.

Bioenergy with carbon capture and storage (BECCS) is considered as a future key technology to provide baseload electricity, heat, pulp, paper, and biofuels, while also enabling atmospheric carbon dioxide removal (CDR). Sweden seeks to lead the way in bringing this technology up to scale, introducing a EUR 3.6 billion reverse auction scheme to facilitate market entry of companies producing BECCS. We explore instrument design preferences among politicians, regulators, and prospective BECCS operators to identify trade-offs and explore feasible policy design. Based on 35 interviews with experts in the latent BECCS sector in Sweden, we identify under which circumstances prospective operators would be willing to place bids and discuss how actor preferences both align with and challenge auction theory. The analysis concludes that at least four dilemmas need attention. These concerns how to: (1) balance the state's demand for BECCS to be implemented already in 2030 against the prospective BECCS operators' fear of the winner's curse, i.e., a fear of bidding for a contract that turns out to be too costly to implement; (2) allocate contracts at the margin of the auctioneer's demand for BECCS without driving up costs; (3) design compliance mechanism to achieve effectiveness without undermining efficiency, and; 4) integrate the auction with the voluntary carbon market—if at all—in a manner that safeguards the environmental integrity of the auctions. [ABSTRACT FROM AUTHOR]

This Comment provides a comprehensive legal analysis of the potential investor-state disputes arising from Germany's groundbreaking Coal Exit Act, which utilizes reverse auctions to phase out coal-fired power plants. The study investigates potential breaches of the Energy Charter Treaty (ECT), focusing on Article 10(1), the fair and equitable treatment clause, and Article 13(1), the expropriation clause. The reverse auction mechanism, when examined under ECT provisions, could be perceived as both a breach of fair and equitable treatment and an unlawful, indirect expropriation, substantially depriving investors of the value of their investments. The analysis also delves into Germany's possible defenses to a prospective claim, including jurisdictional objections, waiver clauses in buyout contracts, exceptions for necessary regulations in the ECT, and withdrawal from the ECT altogether. Findings suggest that investor-state claims can feasibly proceed in response to Germany's coal phase-out policy. Accordingly, policymakers should factor in the costs of Investor-State Dispute Settlement (ISDS) when estimating the cost-saving potential of reverse auctions as a means to phase out high emissions assets like coal-fired powerplants. The Comment concludes by proposing a more efficient buyout transaction structure that leverages carbon markets to enable comparable emissions reductions at a lower marginal cost of abatement and reduce the state's exposure to ISDS claims. [ABSTRACT FROM AUTHOR]

We empirically examine the impacts of the product category, the auction format, the 2008 global financial crisis, the group purchasing, the contract type, the platform ownership, and the number of participating suppliers on the buyer surplus obtained from e-auctions. To this end, we collect a unique dataset from a purchasing organisation that offers e-auction solutions to its corporate customers. By using a standard Tobit model, we show that the product categories, the auction type, and the number of participating suppliers have significant effects on the decrease in the procurement prices with respect to the minimum of the initial submitted bids. It is observed that the 2008 global financial crisis led to an increase in the buyer surplus. We classify the product categories into three groups based on their impacts on the average of the decrease in the procurement prices. We show that the average decrease in procurement prices is higher for the group purchasing option than for the individual buying option. It is concluded that the types of contract between buyers and auctioneer and the platform ownership have no statistically significant effects on the average decrease in procurement prices. [ABSTRACT FROM AUTHOR]

Internet-enabled reverse auctions (RAs) are touted as a means of making the procurement process more effective and efficient, but as is often the case with information technology (IT), there can be risks that managers need to be aware of and mitigate in order to realize the benefits. Using the Delphi methodology followed by semistructured interviews, we identify buyer and supplier perspectives on risk factors associated with RAs and the controls that can address key risk factors. We find that the risk factors map to (1) auction process governance, (2) organizational contingency, (3) buyer–supplier relationship, and (4) agency and transaction cost. Drawing on the findings, we advance an RA risk-control integrative model and formulate corresponding propositions (1) comparing buyers’ and suppliers’ perspectives on risks associated with RA use and (2) identifying controls to mitigate the risks. Our research contributes to theory by (1) surfacing that RAs introduce novel risks and that buyers and suppliers can have either similar or remarkably different views regarding particular risks, (2) showing how both buyers and suppliers can create information asymmetry and act opportunistically, and (3) uncovering the role ofinput controls, a type of control that has not received much attention in the literature on controls for IT initiatives, as an effective means of addressing most of the key risk factors. For practitioners, our study provides guidance about a wide range of risk factors that both parties could face when using RAs, the adverse consequences of these risk factors, and the controls that can be established to mitigate the key risk factors. [ABSTRACT FROM PUBLISHER]

• We asked experts from 27 universities, USDA, CSIRO, EFI, and INRAE about integrating auctions with PES. • Auctions can increase PES efficiency, reveal private costs, and engage stakeholders, but uptake has been slow. • Challenges include participation, accounting for social context, and environmental uncertainty. • Well-understood, field-tested mechanisms are available; innovative new techniques are on the horizon. Auction theory has made major contributions to overcoming allocation problems involving asymmetric information and common-pool resources, leading to multiple Nobel Prizes and serving as a foundation for multi-billion-dollar markets. Despite evidence that related mechanisms could enhance the performance of payments for ecosystem services (PES), adoption has been sporadic and inconsistent. One possibility is that the relevant peer reviewed literature has low visibility or consensus design elements are not sufficiently accessible to interested experts. To overcome this barrier, we adopt a straightforward approach: we asked the PES auction subfield to describe itself. In collaboration with an expert panel (n = 32) whose affiliations span more than two dozen universities and research bodies across three continents—including top-ranked economists, ecosystem services theorists, and practitioners with experience designing and implementing PES programs with and without auctions—we synthesize a birds-eye view of ecosystem services auctions for an interdisciplinary audience. Through an iterative, mixed-method Delphi consultation, we identify broad consensus about fundamental elements of theory and practice, including what functions auctions tend to perform well, common challenges, and key factors influencing their performance. By selecting topics that panelists appeared to disagree about for further discussion, we also highlight open questions and potential research frontiers. We conclude with a reflection on using the Delphi method to foster exchange between time-constrained experts. [ABSTRACT FROM AUTHOR]

Motivated by challenges facing IT procurement, this paper studies a hybrid procurement model in which a reverse auction of a fixed-price IT outsourcing contract may be followed by renegotiation to extend the contract's scope. In this model, the buyer balances the needs to incentivize noncontractible vendor investment and to curb the winning vendor's information rent by choosing the initial project scope and the buyer's investment in the quality of the project. We find that a buyer may benefit from inducing ex post renegotiation to motivate vendor investment, especially when the winning vendor has high bargaining power and the quality uncertainty is low. Broadening the initial scope reduces information rent but leaves little room for ex post renegotiation and, hence, discourages vendor investment, whereas increasing the buyer's investment has opposite effects. Interestingly, the two measures can be strategic substitutes or complements depending on the likelihood of the renegotiation and the two parties' bargaining powers. The buyer may strategically set a low initial project scope and high investment to incentivize renegotiation and vendor investment, which may explain why many IT outsourcing projects start small and allow expansions. Our findings also generate several testable predictions for IT outsourcing. This paper was accepted by Kartik Hosanagar, information systems. [ABSTRACT FROM AUTHOR]

Focal government has set a huge monetary objective of £118 m for acquirement reserve funds in 2009. Effective (eRAs) might add to this objective. Nonetheless, (eRAs) are moderately new to the public area and accordingly, ought to be painstakingly thought of. A new focal government drive, making the Connections, further requires UK public area associations to augment effectiveness gains through joint effort and co-activity. Any advantages from (eRAs) might be expanded and improved in the event that the (eRA) is either attempted as a team with other public area bodies or any (eRA) discoveries are divided among associations. Times attempted cooperatively, by a few public area associations, would show to focal government an eagerness to co-work. To be sure, obviously, this methodology seems to have many advantages, including hazard decrease, hazard spread, further developed agreement arrangements and item request collection to bring down both acquisition and item costs. Besides, most UK area associations normally buy similar products from similar providers. Numerous public area associations have an expert and corporate way to deal with buying, including acquirement techniques and a devoted group of buying experts. Any discoveries from an eRA, whenever shared, would be of interest and maybe, helpful for other public area associations. Obviously, (eRAs) change the customary obtainment process. Any change that might influence this methodology is deserving of investigation to comprehend the effect. This paper thusly, investigates whether productivity gains can be accomplished using (eRAs) through a contextual analysis. The exploration system is talked about in the following area. [ABSTRACT FROM AUTHOR]

Twelve years ago, the federal government awarded hundreds of grants for broadband infrastructure with stimulus funds from the Recovery Act of 2009. In this study, I review the subsidy allocations from the Broadband Technology Opportunities Program and compare actual outcomes with those that a reverse auction or random lottery may have yielded. My analysis shows that a reverse auction might have connected nearly twice as many buildings for the same total subsidy dollars relative to the results from the grant review process. Moreover, the grant review process used by the NTIA did only slightly better in subsidy-dollars-per-building-connected than a random lottery probably would have. Lessons from the Recovery Act are drawn from public data on proposed and awarded projects from application files for stimulus funds. I conclude that the government likely overpaid for broadband by using grant review rather than a reverse auction. The analysis strongly implies that future broadband grants be distributed using market-based methods to get better returns on investment from infrastructure funds. [ABSTRACT FROM AUTHOR]

Supplier non‐performance is an ever present problem for an original equipment manufacturer (OEM) buyer and past survey‐based research has shown that increasing supplier competition adversely affects their performance. Using a reverse auction setting in which supplier competition is determined by number (n) of participating suppliers (bidders), we show how buyer's exposure to supplier non‐performance risk is influenced by n. In particular, we characterize conditions under which supplier non‐performance risk is increasing in n. We then formulate a buyer's decision on the optimal n for uniformly distributed costs that allows it to resolve its cost vs. risk trade‐off. We further investigate other strategies like dual sourcing, better screening, and lower threshold on acceptable bids, that the buyer can use, together with limiting n, to limit non‐performance risk and control its overall procurement cost. Managerially, our findings indicate that an OEM buyer procuring non‐strategic (non‐critical) components could increase its exposure to supplier non‐performance risk by leveraging too much competition, especially among small entrant suppliers. In such situations a buyer can manage its input cost and risk by limiting supplier competition. [ABSTRACT FROM AUTHOR]

In order to realize peer-to-peer (P2P) transactions between electric vehicles (EVs) in vehicle-to-grid (V2G) networks, we propose an EV power trading model based on blockchain and smart contract. Firstly, based on the blockchain and smart contract technology, a decentralized power trading model is proposed to realize the information equivalence and transparent openness of power trading. Then, considering the randomness and uncertainty of EV charging and discharging, the EV trading parties use the reverse auction mechanism based on dynamic pricing strategy to complete the transaction matching, which can not only improve the profit of the less competitive power seller, but also it can reduce the cost of the electricity purchaser. Finally, in order to verify the feasibility of our proposed scheme, V2G's EV power trading smart contract was designed, and the smart contract was released to Ethereum and simulated experiments were carried out. The effectiveness of the proposed scheme is verified by simulation experiments and comparison with traditional power trading schemes.

In information technology outsourcing (ITO), contracts are often awarded through reverse auctions, and renegotiations usually take place for contract amendment after the transaction parties exert joint efforts in project quality improvement. This paper studies an ITO contracting model with the above characteristics from a game-theoretical perspective. We examine the buyer’s design of the initial project scope (which can be renegotiated afterward) and investigate the value of renegotiation to the buyer. The results show that a higher initial scope reduces both the information rent and the effort incentive of the winning provider, and the buyer’s optimal initial project scope is expected to be adjusted upward in the renegotiation. The possibility of renegotiation has effects of both incentivizing the provider effort and generating information rent, but our analytical results show that the former effect is dominant, implying that both the buyer and the provider benefit from the possibility of renegotiation.

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Device-to-device communication allows a cellular user (relay node) to relay data between the base station (BS) and another cellular user (destination node). We address the problem of designing reverse auctions to assign a relay node to each destination node, when there are multiple potential relay nodes and multiple destination nodes, in the scenarios where the transmission powers of the relay nodes are: (1) fixed, (2) selected to achieve the data rates desired by destination nodes, and (3) selected so as to approximately maximize the BS's utility. We show that auctions based on the widely used Vickrey–Clarke–Groves (VCG) mechanism have several limitations in scenarios (1) and (2); also, in scenario (3), the VCG mechanism is not applicable. Hence, we propose novel reverse auctions for relay selection in each of the above three scenarios. We prove that all the proposed reverse auctions can be truthfully implemented as well as satisfy the individual rationality property. Using numerical computations, we show that in scenarios (1) and (2), our proposed auctions significantly outperform the auctions based on the VCG mechanism in terms of the data rates achieved by destination nodes, utility of the BS and/or the interference cost incurred to the BS. [ABSTRACT FROM AUTHOR]

When complex procurement projects are conducted, it is often not possible to write complete contracts. As a consequence, the relationship between buyer and supplier is important for the success of the project. In this paper we investigate the claim that auctions in procurement can be detrimental for the buyer–supplier relationship, which is in line with the observation that reverse auctions are less frequently conducted if projects are complex. A poor relationship can result in a decrease in trust on the part of the buyer during the sourcing process and an increase in the supplier's opportunistic behavior following sourcing. We consider a setting in which the winning supplier decides on the level of quality to provide to the buyer, and we compare a standard reverse auction and a buyer-determined reverse auction, both analytically and in the laboratory. We find that the buyer-determined reverse auction can perform better than the standard reverse auction from both the buyer's and the suppliers' perspective. In a buyer-determined reverse auction, it may be optimal for the buyer to select the supplier who submitted a higher bid, which may in turn induce this supplier to deliver higher quality. Standard auctions, however, yield lower prices but reduce cooperation. The degree of trust, as reflected by a larger number of transactions and a higher average efficiency of trade, is significantly higher in buyer-determined reverse auctions. Theoretical reasoning based on other-regarding preferences organizes our data well. This paper was accepted by Serguei Netessine, operations management. [ABSTRACT FROM AUTHOR]

Companies that manage mandatory pension funds are frequently accused of excessive fee taking. International analyses have found that in countries with legal caps, commissions remain within these caps; hence, market competition does not function. Surprisingly, there are few international cases where local regulators implement mechanisms to facilitate competition. The variety of auction mechanisms available raises the question of whether an optimal solution exists for this purpose. Therefore, in this study, we present evidence, based on a controlled regulatory experiment, on the fee-reduction potential of reverse auctions. [ABSTRACT FROM AUTHOR]

Abstract Feed-in tariffs offer renewable energy developers investor certainty but often at the cost of overly generous subsidisation. Reverse feed-in tariff auctions can overcome this problem but can be adversely affected by non-delivery risks, high auction costs and locational concentration. Between 2012 and 2016, the Australian Capital Territory Government in Australia conducted reverse auctions for the feed-in tariff rights to 640 MW of large-scale solar or wind generating capacity, the first such reverse auction program undertaken in the country. The auctions were used to meet a 100% by 2020 renewable electricity target. The auctions came to be assessed on a number of criteria, including local engagement and economic returns, rather than being narrowly focused on delivery risk and feed-in tariff price. Although the auction's successful projects were relatively concentrated, the auctions were successful in delivering significant local economic benefits as well as decreasing average feed-in tariff prices that declined by 23% for wind and 58% for solar over the period of the auctions driven, in part, by lower internal rates of return and lower interest rates. The delivery of projects and project commitments, and potential locational concentration, are key challenges that other reverse auction users may face. Highlights • Evolution of the reverse auction process in the Australian Capital Territory. • Feed-in tariff reverse auction design options. • Analysis of the outcomes of the first Australian feed-in tariff reverse auction program. • Identification of internal rates of return and debt costs as main drivers of reduced auction wind feed-in tariff prices. • Identification of capital costs and capacity factors as the main drivers of reduced auction solar feed-in tariff prices. [ABSTRACT FROM AUTHOR]

This document analysis the methods of stimulating renewable energy (RES) in various countries, describes the barriers and problems that hinder the development of alternative energy. Studies conducted in countries with a developed renewable energy sector will allow us to conclude that the development incentive systems (Feed-in-tariff (FIT), Renewable Energy Portfolio Standard (RSP), auctions, reverse auctions and various tax incentives) have had the required impact and the government of such countries has moved to establish parity between renewable and traditional energy, as well as to optimize the systems for promoting the development of clean energy. Green energy in countries that are actively developing renewable energy are building models and infrastructures based on the experience and methods of solving the problems of countries with a developed RES support system.

The authors describe a market-based two-stage auction that the FCC, with assistance from researchers from universities and consulting firms, developed. The two-sided auction repurposed 84 MHz of spectrum from conventional over-the-air TV to wireless uses and resulted in reducing the U.S. federal deficit by over $7 billion. In 2017, the U.S. Federal Communications Commission completed the world's first two-sided spectrum auction, reclaiming radio frequency spectrum from television broadcasters to meet exploding demand for mobile broadband, 5G, and other wireless services. Operations research—including a customized series of optimization models, decompositions, cuts, heuristics, large neighborhood searches, and a portfolio of propositional satisfiability solvers whose parameters were determined by machine learning—was essential to the design and implementation of the auction. The auction repurposed 84 megahertz of spectrum and generated gross revenue of nearly $20 billion, providing more than $10 billion in capital for the broadcast television industry and over $7 billion for federal deficit reduction. [ABSTRACT FROM AUTHOR]

Suppliers may experience emotional/behavioral consequences of anticipated regrets that consist of winner and loser regrets in first- and second-price sealed-bid reverse auctions. Constructing mathematical models that incorporate regret theory to derive closed-form solutions of regret-anticipated suppliers’ bid decisions, this paper theoretically examines the effects of anticipated regrets on suppliers’ bid prices, buyer’s expected procurement cost and auction format decision. Comparing with the no regret scenario, we find that winner regret has adverse effects on the buyer’s expected procurement cost in first-price sealed-bid reverse auctions with regret-anticipated suppliers. To mitigate the adverse effects, we propose using the reserve price strategy for the buyer with theoretical analysis and numerical supports. An interesting analysis reveals that as the number of suppliers increases, the optimal reserve price increases or decreases depending on the degree of winner regret is lower or higher than that of loser regret. Also, the classical revenue equivalence theorem no longer holds when the degree of winner regret differs from that of loser regret. [ABSTRACT FROM AUTHOR]

Abstract: To help mitigate large wetland losses in California, The Nature Conservancy launched a dynamic conservation incentive program to create temporary wetland habitats in harvested and fallow rice fields for shorebirds migrating along the Pacific Flyway. Farmers were invited to participate in a reverse auction bidding process and winning bids were selected based on their cost and potential to provide high quality shorebird habitat. This was done in 2014 and 2015, for separate enrollment periods that overlapped with spring and fall migration, both before and after the traditional post‐harvest flooding period. To assess the success of the program, we monitored shorebird use of fields that were enrolled (treatments), and others that were subject to typical rice farm management (controls). To put these observations in context, we used satellites to simultaneously monitor the extent of shallow‐water habitat across the ~215,000 ha of ricelands in the area. Results showed that providing habitat during migration, when it is typically unavailable in rice fields, yielded the largest average shorebird densities ever reported for agriculture in the region. Treatment fields had significantly greater shorebird density, richness and diversity than control fields in both spring and fall (especially September–early October, and late March–early April), but in fall the difference was greater. Shorebird responses to habitat provisioning, and regional habitat conditions, were variable from year to year, and highly dynamic within a given season. Overall, shorebirds densities were found to be negatively related to the total amount of flooded habitat in the rice landscape. Factors that affected habitat availability included allocation schedules of water deliveries from reservoirs, and rainfall patterns, both of which were influenced by drought. Collectively, these results suggest that appropriately managed agricultural lands have great potential to provide high value habitat for shorebirds during times of habitat deficit, including migration, and that fall may be a particularly impactful time to create additional habitat. Migratory species face great challenges due to the climate change, conversion of historical stopover sites, and other factors, but dynamic conservation programs offer promise that, at least in certain instances, their needs can still be met. [ABSTRACT FROM AUTHOR]

The increasing popularity of private land conservation (PLC) globally has quickly translated into an array of polices and programs aimed at achieving ecological benefits. The growth of PLC is entwined with the rise of neoliberal governance, with private land proving congruous with the promotion of market-based instruments (MBIs) and the reliance on private protected areas for conservation in lieu of government investment in public lands. Despite a growing literature on the implications of neoliberal environmental governance, there remains a need for specific insights into the way that individual landholders and ecologies can co-opt or resist the rationalities of MBIs in the practice of private land conservation. Through semi-structured interviews and property walks with 18 landholders, this research examines the implementation of a reverse-auction tender scheme called ‘EcoTender’ in Victoria, Australia. We uncovered four main tensions between the market logic of the program and conservation practice: 1) some landholders used the payment scheme to increase regulatory protections on their property through covenants/easements; 2) many landholders struggled to conceive of their stewardship practice as contractual labour; 3) landholders were producing novel ecosystems that challenged land management focused at the property parcel scale when EcoTender encouraged a return to historical benchmark ecologies, and; 4) many landholders wanted social collaboration when the program required competition for cost efficiency. Our insights show that PLC must create room for a diverse trajectory of conservation practice in dynamic socio-ecological contexts. This means careful reflection on the validity of assumptions underpinning MBIs, the trade-offs that come with applying market logic to conservation and the long-term implications of these instruments for policy and practice. [ABSTRACT FROM AUTHOR]

In a name-your-own-price (NYOP) auction, consumers bid for a product or service. If a bid exceeds the concealed threshold price, the consumer receives the product at her bid price. This paper examines how to optimize the interactions between the NYOP retailer and service providers, while, at the same time, managing the bid acceptance rates in order to induce the desired consumer bidding behavior. Channel profit is impacted by how the retailer decides whether or not a given consumer bid will be accepted and, if so, which service provider is chosen to supply a unit of the product to the consumer. We devise a mechanism, the modified second-price auction, which maximizes channel profit. This paper was accepted by J. Miguel Villas-Boas, marketing. [ABSTRACT FROM AUTHOR]

Conservation auctions have the potential to increase the efficiency of payments to farmers to adopt conservation-friendly management practices by fostering competition among them. The literature considers bidders that have complete information about the costs of adoption and optimal bidding behavior reflects this information advantage. Farmers seek information rents and bids decrease when risk aversion increases because farmers are more averse to losing the auction. We contribute to the literature by allowing for cost risk. Our paper shows that farmers must balance the risk of losing the auction (thus foregoing information rent) with the risk of submitting a bid that is not high enough to pay the costs of adopting conservation practices (thus incurring losses). We design an experiment to trade off these two risks and examine how risk aversion affects bidding behavior when participants face different sources and levels of risk. Our experiment contributes to a small literature on experimental auctions with risky product valuations. We find that participants decrease their bids as risk aversion increases, even in auctions with cost risk, suggesting that the risk of losing the auction dominates. These findings uncover new challenges for the practical implementation of conservation auctions as an efficient policy instrument. [ABSTRACT FROM AUTHOR]

This study introduces an advanced Combinatorial Reverse Auction (CRA), multi-units, multiattributes and multi-objective, which is subject to buyer and seller trading constraints. Conflicting objectives may occur since the buyer can maximize some attributes and minimize some others. To address the Winner Determination (WD) problem for this type of CRAs, we propose an optimization approach based on genetic algorithms that we integrate with our variants of diversity and elitism strategies to improve the solution quality. Moreover, by maximizing the buyer's revenue, our approach is able to return the best solution for our complex WD problem. We conduct a case study as well as simulated testing to illustrate the importance of the diversity and elitism schemes. We also validate the proposed WD method through simulated experiments by generating large instances of our CRA problem. The experimental results demonstrate on one hand the performance of our WD method in terms of several quality measures, like solution quality, run-time complexity and trade-off between convergence and diversity, and on the other hand, it's significant superiority to well-known heuristic and exact WD techniques that have been implemented for much simpler CRAs. [ABSTRACT FROM AUTHOR]

Payments for ecosystem services (PES) programs are one prominent strategy to address economic externalities of resource extraction and commodity production, improving both social and ecological outcomes. But do PES and related incentive programs achieve that lofty goal? Along with considerable enthusiasm, PES has faced a wide range of substantial critiques. In this paper, we characterize seven major classes of concerns associated with common PES designs, and use these as inspiration to consider potential avenues for improvements in PES outcomes and uptake. The problems include (1) new externalities, (2) misplacement of rights and responsibilities, (3) crowding out existing motivations, (4) efficiency-equity tradeoffs, (5) monitoring costs, (6) limited applicability, and (7) top-down prescription/alienating agency. As currently practiced, many PES programs are thus of limited benefit and even potentially detrimental to sustainability. From this dire conclusion, we highlight several innovations that might be combined and extended in a novel approach to PES that may address all seven problems. Recognizing that PES necessarily articulate and even normalize values, our proposed approach entails designing these institutions intentionally to articulate rights and responsibilities conducive to sustainability—those we might collectively seek to entrench. Problems remain, and new ones may arise, but the proposed approach may offer a way to reimagine PES as a major social and economic tool for enabling sustainable relationships with nature, conserving and restoring ecosystems and their benefits for people now and in the future. [ABSTRACT FROM AUTHOR]

Real-world procurement transactions often involve multiple attributes and multiple vendors. Successful procurement involves vendor selection through appropriate market mechanisms. The advancement of information technologies has enabled different mechanisms to be applied to similar procurement situations. However, advantages and disadvantages of using such mechanisms remain unclear. The presented research compares two types of mechanisms: multi-attribute reverse auctions and multi-attribute multi-bilateral negotiations in e-procurement. Both laboratory and online experiments were carried out to examine their effects on the process, outcomes, and suppliers’ assessment. The results show that in procurement, reverse auctions were more efficient than negotiations in terms of the process. Auctions also led to greater gains for the buyers than negotiations, but the suppliers’ profit was lower in auctions. The buyer and the winning supplier jointly reached more efficient and balanced contracts in negotiations than in auctions. The results also show that the suppliers’ assessment was affected by their outcomes: the winning suppliers had a more positive assessment toward the process, outcomes, and the system. The findings are consistent in both the laboratory and the online settings. Finally, the implications of this study for practitioners and researchers are discussed. [ABSTRACT FROM PUBLISHER]

ABSTRACT This paper develops a framework to simulate and evaluate pricing policies of spacecraft trading commodities, such as data routing, in a federated satellite network. Federated satellite systems allow the reallocation of underutilized assets, enabling their use as services between owners and third parties. The paper, by means of game theory, focuses on sealed-bid reverse auction pricing schemes, benchmarks first-price and second-price auction strategies, and evaluates the associated trade-offs in terms of performance and cost, and losses in Pareto efficiency introduced by system-level operation constraints. The analysis considers an application case study for federated satellite systems operating in Low Earth Orbit for commercial purposes. Satellite federations are a novel paradigm envisioning on-orbit opportunistic sharing of resources through an ad hoc mobile satellite network. The architecture creates the basis for the realization of a commercial cloud computing environment in orbit, with spacecraft establishing communications links between each other leveraging on system design margins. The results of the case study in space provide new insights on the design of federated satellites and their operations while characterizing emergent behaviors and efficient trade-offs on the Pareto front of the cost-performance curve. [ABSTRACT FROM AUTHOR]

Financial incentives are commonly used to promote voluntary adoption of agricultural best management practices (BMPs), but little is known about farmer preferences among alternative incentives. Using experimental procurement auctions, we evaluate how different conservation incentives affect farmer willingness to adopt BMPs that reduce phosphorus (P) runoff, a major driver of harmful algal blooms in Lake Erie. We rank incentives (e.g., payment, BMP insurance, tax credit, and certification price premium) by the cost per pound of P runoff reduction. Payments and tax credits that target high impact areas of the watershed are more cost-effective than untargeted price premiums for product certification. Farmers demand higher payments for contracts offering BMP insurance (i.e., protection against yield loss from BMP use) due to uncertainty about how the program will be implemented and the reliability of indemnities, as well as anticipated transaction costs associated with the program. Understanding farmer preferences for different types of conservation incentives is critical to design agri-environmental programs that engage more farmers and cost-effectively enhance ecosystem services. [ABSTRACT FROM AUTHOR]

Government agencies that conduct reverse auctions related to the Payment of Ecosystem Services (PES) traditionally provide a significant amount of public information about past auction results. This information includes not only the amount of money spent by the government but also can include various information about the accepted bids. This research uses induced-value experiments to evaluate the effect of past auction information on seller (landholder) rent seeking. Results suggest that sellers use this public information and learn how to secure higher rents. However, when sellers are given information only about the buyer's (government agency's) budget, they secure lower rents. Results also suggest that relative budget size affects rents and that budget stochastic variability in the presence of market information diminishes the effect. Thus, in the presence of public information and equivalent total outlays, variable budgets are more likely than stationary budgets to achieve auction fiscal efficiency—the measure of whether the auction achieves the greatest PES benefits given its limited budget. Finally, this research finds that auctions with greater heterogeneity in seller opportunity costs are likely to be less fiscally efficient than when the distribution is more homogeneous. [ABSTRACT FROM AUTHOR]

An introduction is presented in which the editor discusses various reports within the issue on topics including reverse auctions used in business-to-business (B2B) procurement, the effects of suggestive guidance by decision support systems, and user motivation in engaging in secure behaviors in the information systems (IS) context.

We consider service providers (e.g., contractors) who bid for undertaking a large project - reverse auctions. As there is a risk that the lowest bidder will not be able to complete the project on budget or time, the customer, often a government agency, wishes to incorporate prior information on the bidders reliabilities into the choice of winning bid. We consider the use of official ratings of bidders, which are common knowledge. The customer is assumed to select the bidder for which the ratio of bid to rating is the lowest. A bidder assumes that each other bidder's bid is the sum of its private value, the ratio of this value to its rating and the inverse of the rating. We characterize the equilibrium bids of two bidders, of symmetric bidders and of three nonsymmetric bidders, and provide comparative statics and examples. We also discuss a scenario where all ratings are known only to the customer, and each bidder knows only its own rating. [ABSTRACT FROM AUTHOR]

In a world free of transaction costs, reverse auctions have the potential to cost-effectively allocate payment for environmental service contracts by targeting projects that provide the most benefit per dollar spent. However, auctions only succeed if enough farmers choose to bid so that the auctioneer can evaluate numerous projects for targeted funding. A 2014 conservation auction to allocate payments for practices that reduce phosphorus runoff in Northwest Ohio experienced very thin bidding. According to a follow-up survey, auction participation was deterred by the perceived complexity of the bidding process and the need to negotiate with renters. Due to low participation, the actual conservation auction made payments for phosphorus reduction that were surprisingly costly at the margin. Applying a farmer behavioral model to the Western Lake Erie Basin, we simulate participation choice and cost-effectiveness of environmental outcomes in reverse auctions and uniform payment conservation programs. Results reveal that when perceived transaction costs of bid preparation are high, reverse auctions can be less cost-effective than spatially targeted, uniform payment programs that attract higher participation. [ABSTRACT FROM AUTHOR]

Electronic reverse auctions are a commonly used procurement mechanism. Research to date has focused on suppliers who are ex ante symmetric in that their costs are drawn from a common distribution. However, in many cases, a seller's range of potential costs depends on their own operations, location, or economies of scale and scope. Thus, understanding how different bidder types impact auction outcomes is key when designing an auction. This study reports the results of the first controlled laboratory experiment designed to compare prices between first-price and second-price procurement auctions for homogeneous goods when seller cost types are asymmetric and the number of bidders varies. The results indicate that first-price auctions generate lower prices regardless of market composition. The results also reveal that first-price auctions are at least weakly more efficient than second-price auctions despite the theoretical prediction that the reverse should hold in asymmetric auctions. Post hoc analysis of individual bidders' behavior in first-price auctions revealed evidence that bidders systematically underbid when their cost realizations were close to the lower bound. Furthermore, bidders adjust their behavior based on the type of the other bidders in the market in a manner inconsistent with theory. Consequently, adding a third bidder to a two-bidder market is not advantageous to the buyer unless that third bidder is a low-cost type. [ABSTRACT FROM AUTHOR]

This paper examines the economic challenges faced by Australia's Direct Action abatement subsidy scheme. Introduced in 2014, the scheme operates by reverse auction, funding projects voluntarily proposed by the private sector. Because the Government cannot know true project counterfactuals, the lowest auction bids are likely to often be non-additional 'anyway' projects. The scheme is hence likely to exhibit a systematic skew towards low-quality abatement. The paper presents a model of the adverse selection problem and describes the early experience with Direct Action. A discussion of a way forward is also provided. [ABSTRACT FROM AUTHOR]

Today's smartphones with a rich set of cheap powerful embedded sensors can offer a variety of novel and efficient ways to opportunistically collect data, and enable numerous mobile crowdsourced sensing (MCS) applications. Basically, incentive is one of fundamental issues in MCS. Through appropriately integrating three popular incentive methods: reverse auction, reputation and gamification, this paper proposes a quality-aware incentive framework for MCS, QuaCentive, which, pertaining to all components in MCS, can motivate crowd to provide high-quality sensed contents, stimulate crowdsourcers to give truthful feedback about quality of sensed contents, and make platform profitable. Specifically, first, we utilize the reverse auction and reputation mechanisms to incentivize crowd to truthfully bid for sensing tasks, and then provide high-quality sensed contents. Second, in to encourage crowdsourcers to provide truthful feedbacks about quality of sensed data, in QuaCentive, the verification of those feedbacks are crowdsourced in gamification way. Finally, we theoretically illustrate that QuaCentive satisfies the following properties: individual rationality, cost-truthfulness for crowd, feedback-truthfulness for crowdsourcers, platform profitability. [ABSTRACT FROM AUTHOR]

With the dramatic growth of Internet video streaming applications, resource provisioning for video streaming systems to satisfy their upload bandwidth deficit is a challenging task. The design of incentive mechanisms for taking advantage of unused upload capability of helper peers is proven to be a viable, cost-effective solution for this problem. The existing incentive mechanisms for video streaming systems do not consider the hierarchical nature of helper-server interactions, the limited budget of server to procure the needed bandwidth, and limited information of helpers about the other parties in the system. To address these issues, we designed cooperation mechanisms for two different cases: in the full-information case where the server has the full control over the amount of payments to each helper, a Stackelberg helping game is formulated in which the server as leader determines the amount of payment for each helper and then, helpers as followers decide on their amount of contributed bandwidth accordingly. We characterize the Stackelberg Equilibrium (SE) point of game in which the server shares the benefits of bandwidth sharing with the helpers through a market mechanism. In the partial information case where the helpers' cost and utility functions are private and unknown to the server, we propose a budget-limited reverse auction in which the helpers, in contrast to the former case, announce the lowest price at which they are willing to sell their upload bandwidth first and the server then selects a subset of the helpers and pays them proportional to their contributions. The results of extensive simulations reveal that the mechanisms are truthful and result in lower server workload and higher peers' streaming rate and delivery ratio. [ABSTRACT FROM AUTHOR]

The paper discusses experiments aimed at comparing multi-attribute reverse auctions and multi-bilateral negotiations for procuring goods with multiple attributes. Both exchange mechanisms involve a buyer purchasing from one of several sellers. Two types of negotiations are considered: verifiable and non-verifiable. They differ in the sellers' knowledge of the current best offer on the table; in verifiable negotiations the best offer is automatically shown to every participant, which makes it similar to auctions. Online auctions and negotiation systems were used to study auction and negotiation processes, and the mechanisms' efficiency. The results show that buyers did best using auctions, followed by non-verifiable and verifiable negotiations. We also looked into the differences between auctions and negotiations in terms of their duration, sellers' and buyers' involvement, and efficiency and conclude that the behavior of buyers and sellers cannot be explained solely on the grounds of traditional economics. It can, however, be explained on the grounds of social exchange theory and behavioral economics. In multi-bilateral negotiations competition and social behavior coexist. When transparency is introduced the social effect becomes stronger, weakening the impact of competition. [ABSTRACT FROM AUTHOR]

This article investigates a hybrid procurement mechanism that combines a reverse auction with flexible noncompetitive contracts. A buyer adopts such mechanism to procure multiple units of a product from a group of potential suppliers. Specifically, the buyer first offers contracts to some suppliers who, if accepting the contract, do not participate in the auction while committing to selling a unit to the buyer at the price of the subsequent auction. For the suppliers rejecting the offers, they can join the subsequent auction with the other suppliers to compete on the remaining units. When the buyer offers only one flexible noncompetitive contract, we find that the selected supplier may accept the offer regardless of whether he knows his exact cost information. Meanwhile, the buyer can benefit from offering such a contract, as opposed to solely conducting a regular reverse auction or offering a noncompetitive contract that does not allow suppliers declining offers to join the subsequent auction. Moreover, we find that the suppliers' information about their own costs has a significant impact on the buyer's decision. When the buyer makes multiple offers, we analyze the resulting game behavior of the selected suppliers and demonstrate that the buyer can benefit more than just offering one such contract. Therefore, the hybrid procurement mechanism can be mutually beneficial for both the buyer and the selected suppliers. [ABSTRACT FROM AUTHOR]

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