The first use of a combined-value auction for transportation services

John O. Ledyard*, Mark Olson, David Porter, Joseph A. Swanson, David P. Torma

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

138 Scopus citations

Abstract

Combined-value auctions (CVAs) allow participants to make an offer of a single amount for a collection of items. These auctions provide value to both buyers and sellers of goods or services in a number of environments, but they have rarely been implemented, perhaps because of lack of knowledge and experience. Sears Logistics Services (SLS) is the first procurer of trucking services to use a CVA to reduce its costs. In 1993, it saved 13 percent over past procurement practices. Experimental economics played a crucial role in the development, sale, and use of the CVA.

Original languageEnglish (US)
Pages (from-to)4-12
Number of pages9
JournalInterfaces
Volume32
Issue number5
DOIs
StatePublished - 2002

Keywords

  • Economics
  • Games/group decisions: bidding/auctions
  • Transportation: costs

ASJC Scopus subject areas

  • Strategy and Management
  • Management Science and Operations Research
  • Management of Technology and Innovation

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