Office of Technology Transfer – University of Michigan

A Progressive Price-Driven Combinatorial Auction Mechanism

Technology #1762

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Michael P. Wellman
Managed By
Drew Bennett
Associate Director - Software Licensing 734-615-4004
Patent Protection
US Patent Pending


The recent FCC auction of the electromagnetic spectrum has rekindled interest in the use of auctions to allocate scarce, bundled goods to multiple buyers. These are goods that may be synergistic when purchased in certain combinations. Certain bundles will have greater value to some buyers than others, and each buyer would like to maximize the value of their bundled goods. Most common auction mechanisms are adequate for relatively simple, one-dimensional auctions, but for more complex buying schemes, such as for bundled goods, sophisticated auction mechanisms are needed.


Researchers at The University of Michigan have developed a proprietary e-commerce algorithm technology that controls a progressive, price-driven auction mechanism resulting in the optimal allocation of interrelated (bundled) goods to multiple buyers, while requiring minimal effort from buyers. This technology allows bidders to express offers for combinations of goods, while being iterative, progressive, and based on clearing prices. At the end of the process, each bidder automatically gets the bundle of goods that maximizes the value of its stated offer.

Applications and Advantages


  • Auctions of bundled goods


  • Easy to use
  • Efficient
  • Fair and rational