TimeBoost: Do Ahead-of-Time Auctions Work?
Akaki Mamageishvili, Christoph Schlegel, Ko Sunghun, Jinsuk Park, Ali Taslimi

TL;DR
This paper evaluates the effectiveness of the TimeBoost auction by analyzing how well bids predict future value, revealing weak correlations but some predictive trends over time.
Contribution
It provides an empirical analysis of TimeBoost auction performance, highlighting the predictive limitations of bids and the importance of trend detection.
Findings
Weak correlation between winning bids and markouts across bidders
Higher correlation when comparing paid bids to markouts over long intervals
Previous minute markouts significantly predict current minute bids
Abstract
We study the performance of the TimeBoost auction, by comparing cumulative fixed time markout of fast lane trades over the TimeBoost interval to bids for the fast lane. Such comparison allows us to assess how well bids predict future extracted value from the time advantage. The correlation between winning bids and markouts is weak across bidders, suggesting that bids are a noisy predictor of extracted value. The correlation slightly improves when comparing paid bids (the second highest bid) instead of winning bids to markouts, which we attribute to the fact that the auction is more of a common value type. In all settings, the relative order of the most frequent bidder performance remains the same, together with their absolute profits. Bids and markouts aggregated over long time intervals exhibit much higher correlation, indicating that bidders detect trends much better than identify…
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Taxonomy
TopicsAuction Theory and Applications · Consumer Market Behavior and Pricing · Electric Power System Optimization
