Auction-Based Mechanisms for Electronic Procurement

Abstract—Auction-based mechanisms are extremely relevant in modern day electronic procurement systems since they enable a promising way of automating negotiations with suppliers and achieve the ideal goals of procurement efficiency and cost minimiza-tion. This paper surveys recent research and current art in the area of auction-based mechanisms for e-procurement. The survey de-lineates different representative scenarios in e-procurement where auctions can be deployed and describes the conceptual and math-ematical aspects of different categories of procurement auctions. We discuss three broad categories: 1) single-item auctions: auctions for procuring a single unit or multiple units of a single homoge-neous type of item; 2) multi-item auctions: auctions for procuring a single unit or multiple units of multiple items; and 3) multiat-tribute auctions where the procurement decisions are based not only on costs but also on attributes, such as lead times, maintenanc