Reverse Vickrey Auction

You should use a reverse Vickrey auction when:

There is only a single unit being auctioned.
There are multiple bidders.
The winner should be the lowest bidder.
You want the bidders to be truthful.

The winner will be the lowest bidder, and they will receive the second lowest bid as payment.

An example of when to use a reverse Vickrey auction is if you want someone to mow your lawn, you want to pay the lowest possible price, and you do not care who performs the work.

During the auction, you can create ballots and distribute them as you please. Each ballot can be submitted with a bid or declined. You will be able to see when each decision is made, but not the content of each decision.

When the auction resolves, you will be able to see the label of the winning ballot and the transaction price. The winning ballot will also be able to see that information.

No other information will be revealed to you.

If the highest bidder should win and pay the second highest bid, consider a Vickrey auction.

Run your own reverse Vickrey auction

When should the auction be resolved?

Can the auction resolve early?

The auction will resolve early if all bids are in.

The auction will not resolve until the resolution time.

What currency should the auction use?

What is the reserve price? The transaction price must be at most:

In the case of a tie, who wins?

A randomly-chosen tied bidder wins.

The earliest tied bidder wins.

What information should be revealed to non-winning ballots?

Only that the auction resolved.

Whether or not the auction had a winner.

The transaction price, when available.

The label of the winning ballot, when available.

Both the transaction price and the label of the winning ballot, when available.