3 ms·

In game theoretic terms, is there a best strategy for a game like this, other than not playing?

deleted 10y ago
[deleted]
igf 10y ago
I don't know if game theory is the branch of mathematics that can help you out here. Game theory usually rests on matters of "If I do X then my opponent(s) will do Y", but in this situation you don't even know how many opponents you might have. Your best shot would probably to be just to sit there and collect a shitload of statistics about under exactly what circumstances you're most likely to be the final bidder, and then only bid under those circumstances... and then hope nobody else has been collecting the same statistics and coming to exactly the same conclusion.
CipE 10y ago
Assuming a constant cost per bid, given that every time you put in a bid you lose money, and the site owner can always get a guaranteed win, you need to minimize the number of bids you make: Optimal number of bids is 0. Since we're constrained to play, bid once. (It doesn't matter when, you won't win).
oli5679 10y ago
This game is difficult to formalise because of the real time bidding aspect. Say agents pre-commit to bid or not in discrete time periods, one Nash Equilibrium would be symmetrical mixed strategies such that each agent has 0 expected payoff from bidding. Eg if 10 players, $0.4 fee and $0.5 bid then would need players to bid with probability p st: 0.9 = 180 *(1-p) ^9. This changes if agents value winning more/less than $180 in present/future (patience, risk neutrality, value placed on tablet + process of playing gambling game).
- oli5679 10y ago
  Edit: Thinking a bit more about this, the real time bidding aspect isn't really a problem. You do need to know how many other players there are now/in the future though. Symmetrical strategies: bid_cost(t) = object_value * (1-p(t+1))^N-2 for all t, for all agents not currently winning auction is a MSNE.
kqr 10y ago
A friend I used to know actually got reasonably skilled at getting stuff from penny auctions. I personally witnessed him net gain from the exchanges (and bought some electronics from him for very cheap, since he had several of each at that point...) He never shared his methods, but did say that one of the most important considerations is the target audience of the item in question and at what times they are likely to be bidding. You can glean that information by continuously observing many ongoing auctions. The basic strategy was "hold off until people have stopped bidding, then put one bid down. If it doesn't work out, go have a picnic in the park and try again later." This may have been before such sites offered pre-configured bots.
espadrine 10y ago
All information you have as a player is misinformation, as demonstrated. As a result, the single factor that makes you "win" is whether the other players stop playing, letting the timer hit its limit. There are two reasons for them to do so: exhaustion or cost. Some players may have stolen cards or plan on denying the payment, making cost potentially limitless. Some players newly join and some are bots, making exhaustion a non-issue. As a result, the game is completely random. The only winning move is to be the house. There is one small vulnerability in the website they tested, which is that when the system senses player exhaustion, it sinks the price to attract new players. It happens twice at the end of the graph. When the price is on a downward slope going past a certain point, it probably means that few players intend to pursue.
- daemin 10y ago
  To me this seems effectively like a slot machine, where people keep feeding in money for someone else to eventually win some sort of prize. I would equate the lowering of the price to a small payout so that the person keeps playing for a bit longer.

deleted 10y ago

[deleted]

igf 10y ago

I don't know if game theory is the branch of mathematics that can help you out here. Game theory usually rests on matters of "If I do X then my opponent(s) will do Y", but in this situation you don't even know how many opponents you might have. Your best shot would probably to be just to sit there and collect a shitload of statistics about under exactly what circumstances you're most likely to be the final bidder, and then only bid under those circumstances... and then hope nobody else has been collecting the same statistics and coming to exactly the same conclusion.

CipE 10y ago

Assuming a constant cost per bid, given that every time you put in a bid you lose money, and the site owner can always get a guaranteed win, you need to minimize the number of bids you make: Optimal number of bids is 0. Since we're constrained to play, bid once. (It doesn't matter when, you won't win).

oli5679 10y ago

This game is difficult to formalise because of the real time bidding aspect. Say agents pre-commit to bid or not in discrete time periods, one Nash Equilibrium would be symmetrical mixed strategies such that each agent has 0 expected payoff from bidding. Eg if 10 players, $0.4 fee and $0.5 bid then would need players to bid with probability p st: 0.9 = 180 *(1-p) ^9. This changes if agents value winning more/less than $180 in present/future (patience, risk neutrality, value placed on tablet + process of playing gambling game).

oli5679 10y ago
Edit: Thinking a bit more about this, the real time bidding aspect isn't really a problem. You do need to know how many other players there are now/in the future though. Symmetrical strategies: bid_cost(t) = object_value * (1-p(t+1))^N-2 for all t, for all agents not currently winning auction is a MSNE.

kqr 10y ago

A friend I used to know actually got reasonably skilled at getting stuff from penny auctions. I personally witnessed him net gain from the exchanges (and bought some electronics from him for very cheap, since he had several of each at that point...) He never shared his methods, but did say that one of the most important considerations is the target audience of the item in question and at what times they are likely to be bidding. You can glean that information by continuously observing many ongoing auctions. The basic strategy was "hold off until people have stopped bidding, then put one bid down. If it doesn't work out, go have a picnic in the park and try again later." This may have been before such sites offered pre-configured bots.

espadrine 10y ago

All information you have as a player is misinformation, as demonstrated. As a result, the single factor that makes you "win" is whether the other players stop playing, letting the timer hit its limit. There are two reasons for them to do so: exhaustion or cost. Some players may have stolen cards or plan on denying the payment, making cost potentially limitless. Some players newly join and some are bots, making exhaustion a non-issue. As a result, the game is completely random. The only winning move is to be the house. There is one small vulnerability in the website they tested, which is that when the system senses player exhaustion, it sinks the price to attract new players. It happens twice at the end of the graph. When the price is on a downward slope going past a certain point, it probably means that few players intend to pursue.

daemin 10y ago
To me this seems effectively like a slot machine, where people keep feeding in money for someone else to eventually win some sort of prize. I would equate the lowering of the price to a small payout so that the person keeps playing for a bit longer.