Simulating the Effectiveness of an Alternative Salary Auction Mechanism

Abstract

This research simulates the effectiveness of an alternative auction mechanism for Assignment Incentive Pay (AIP) that has potential for reducing the U.S. Department of Defense's (DoD's) cost. A recent student thesis studying the application of salary auctions and matching in an assignment setting determined that there are two major complications in an assignment auction which affect the incentive of bidders to submit a truthful valuation of the jobs. An alternative auction mechanism that combined elements of both auction theory and matching was proposed to overcome these complications. This study further defines this alternative auction mechanism and presents a simulation setup for testing the effectiveness of the mechanism. Simulation is carried out and the mechanism is evaluated based on defined operational performance and efficiency measures. The objective of this thesis is to evaluate the benefits of the alternative auction mechanism to DoD.

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Document Details

Document Type
Technical Report
Publication Date
Dec 01, 2006
Accession Number
ADA462687

Entities

People

  • Pei Yin Tan

Organizations

  • Naval Postgraduate School

Tags

DTIC Thesaurus Topics

  • Algorithms
  • California
  • Commerce
  • Competition
  • Computer Programming
  • Cost Effectiveness
  • Costs
  • Demographic Cohorts
  • Department Of Defense
  • Efficiency
  • Iterations
  • Linear Programming
  • Motivation
  • Public Policy
  • Schools
  • Simulations
  • United States

Readers

  • Computational Modeling and Simulation
  • Government Contracting/Procurement.
  • Naval Personnel Management