VICKREY Meaning and
Definition
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Vickrey refers to a form of auction mechanism named after its developer, William Vickrey, an economist who received the Nobel Prize in 1996 for his contributions to auction theory. The Vickrey auction, also known as a second-price sealed-bid auction, is a type of auction where bidders simultaneously submit their bids without knowing the bids of the others. The highest bidder wins the item or service being auctioned, but the price paid is equal to the second-highest bid, rather than the winning bid. In other words, the winner pays the price offered by the second highest bidder.
This auction format promotes truthful bidding since each bidder has an incentive to bid their true valuation of the item to maximize their chances of winning. By encouraging genuine bids, the Vickrey auction tends to yield a more accurate determination of the participants' values. It also eliminates the "winner's curse," which can occur when the highest bidder overestimates the value of the item and ends up paying more than necessary.
The Vickrey auction has been widely studied and has applications in various domains such as government procurement, art auctions, and advertising. Its theoretical properties make it an attractive mechanism for allocating resources efficiently while maintaining transparency and fairness.
Etymology of VICKREY
The word vickrey does not have a prevalent etymology because it is not a widely recognized word. It is not found in standard English dictionaries or have any well-known origin. If you are referring to the name Vickrey, it is a variant of the English surname Vickers, which is derived from the Middle English name Vicarius, meaning deputy or substitute. However, without additional context, it is unclear what exactly you are referring to with the term vickrey.
Similar spelling words for VICKREY
