Abstract
Abstract The procurement decision problem of divisible goods is investigated, and an optimization decision method for procuring a kind of divisible goods (such as coal, oil, electricity, gas, etc.) is presented based on multi-attribute auction. Firstly, the procurement decision problem of divisible goods is converted into a multi-attribute auction of divisible goods. Correspondingly, several important assumptions of multi-attribute procurement auction are given, and the buyer's utility function and the supplier's utility function are defined. Secondly, the scoring rules and bidding rules are given. And aiming at maximizing the buyer's expected utility, an optimization decision model of selecting the suppliers in multi-attribute auction is established. By solving this model, the optimal suppliers and the optimal allocation strategies are obtained. Thirdly, the suppliers’ optimal bidding strategies are discussed, and the feasibility of multi-attribute auction mechanism is proved. Lastly, a multi-attribute a...
Highlights
As a price discovery and resource allocation mechanism, Auction has been widely used in many areas of the electronic commerce
The procurement decision problem of divisible goods is studied, and a procurement decision model is presented based on multi-attribute auction
To present an incentive and competitive method to procuring a kind of divisible goods, we propose an optimization decision method based on multi-attribute auction theory in this paper
Summary
As a price discovery and resource allocation mechanism, Auction has been widely used in many areas of the electronic commerce. They suggested an inverse-optimization based approach that allows the buyer via several changes in the announced scoring rule, to learn the suppliers’ cost functions and determine a scoring rule that maximizes the buyer’s utility within an open ascending auction format Parallel to these works, David et al.[15] extended Che’s model for more realistic electronic commerce applications, where the reverse auction considers multiple non-price attributes. The procurement decision problem of divisible goods (such as coal, oil, electricity, gas, etc.) is studied, and a procurement decision model is presented based on multi-attribute auction In this optimization decision model, other attributes in addition to the price and quantity are considered further, such as the development cycle, delivery time, different quality parameters, service quality, and suppliers’ reputation, and so on.
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