{"ID":2859083,"CreatedAt":"2026-06-01T04:54:23.091178241Z","UpdatedAt":"2026-06-01T04:54:23.091178241Z","DeletedAt":null,"paper_url":"https://arxiv.org/abs/2510.05474","arxiv_id":"2510.05474","title":"Hallucinating Flows for Optimal Mechanisms","abstract":"Myerson's seminal characterization of the revenue-optimal auction for a single item \\cite{myerson1981optimal} remains a cornerstone of mechanism design. However, generalizing this framework to multi-item settings has proven exceptionally challenging. Even under restrictive assumptions, closed-form characterizations of optimal mechanisms are rare and are largely confined to the single-agent case \\cite{pavlov2011optimal,hart2017approximate, daskalakis2018transport, GIANNAKOPOULOS2018432}, departing from the two-item setting only when prior distributions are uniformly distributed \\cite{manelli2006bundling, daskalakis2017strong,giannakopoulos2018sjm}. In this work, we build upon the bi-valued setting introduced by Yao \\cite{YAO_BIC_DSIC}, where each item's value has support 2 and lies in $\\{a, b\\}$. Yao's result provides the only known closed-form optimal mechanism for multiple agents. We extend this line of work along three natural axes, establishing the first closed-form optimal mechanisms in each of the following settings: (i) $n$ i.i.d. agents and $m$ i.i.d. items (ii) $n$ non-i.i.d. agents and two i.i.d. items and (iii) $n$ i.i.d. agents and two non-i.i.d. items. Our results lie at the limit of what is considered possible, since even with a single agent and m bi-valued non-i.i.d. items, finding the optimal mechanism is $\\#P$-Hard \\cite{daskalakis2014complexity, xi2018soda}. We finally generalize the discrete analog of a result from~\\cite{daskalakis2017strong}, showing that for a single agent with $m$ items drawn from arbitrary (non-identical) discrete distributions, grand bundling is optimal when all item values are sufficiently large. We further show that for any continuous product distribution, grand bundling achieves $\\mathrm{OPT} - ε$ revenue for large enough values.","short_abstract":"Myerson's seminal characterization of the revenue-optimal auction for a single item \\cite{myerson1981optimal} remains a cornerstone of mechanism design. However, generalizing this framework to multi-item settings has proven exceptionally challenging. Even under restrictive assumptions, closed-form characterizations of...","url_abs":"https://arxiv.org/abs/2510.05474","url_pdf":"https://arxiv.org/pdf/2510.05474v1","authors":"[\"Marios Mertzanidis\",\"Athina Terzoglou\"]","published":"2025-10-07T00:29:51Z","proceeding":"cs.GT","tasks":"[\"cs.GT\"]","methods":"[]","has_code":false}