Truthful Mechanisms via Greedy Iterative Packing (0906.2466v1)

Abstract: An important research thread in algorithmic game theory studies the design of efficient truthful mechanisms that approximate the optimal social welfare. A fundamental question is whether an \alpha-approximation algorithm translates into an \alpha-approximate truthful mechanism. It is well-known that plugging an \alpha-approximation algorithm into the VCG technique may not yield a truthful mechanism. Thus, it is natural to investigate properties of approximation algorithms that enable their use in truthful mechanisms. The main contribution of this paper is to identify a useful and natural property of approximation algorithms, which we call loser-independence; this property is applicable in the single-minded and single-parameter settings. Intuitively, a loser-independent algorithm does not change its outcome when the bid of a losing agent increases, unless that agent becomes a winner. We demonstrate that loser-independent algorithms can be employed as sub-procedures in a greedy iterative packing approach while preserving monotonicity. A greedy iterative approach provides a good approximation in the context of maximizing a non-decreasing submodular function subject to independence constraints. Our framework gives rise to truthful approximation mechanisms for various problems. Notably, some problems arise in online mechanism design.