Tight Regret Bounds for Fixed-Price Bilateral Trade

Abstract

We examine fixed-price mechanisms in bilateral trade through the lens of regret minimization. Our main results are twofold. (i) For independent values, a near-optimal Θ̃(T^{2/3}) tight bound for Global Budget Balance fixed-price mechanisms with two-bit/one-bit feedback. (ii) For correlated/adversarial values, a near-optimal Ω(T^{3/4}) lower bound for Global Budget Balance fixed-price mechanisms with two-bit/one-bit feedback, which improves the best known Ω(T^{5/7}) lower bound obtained in the work [Martino Bernasconi et al., 2024] and, up to polylogarithmic factors, matches the 𝒪̃(T^{3/4}) upper bound obtained in the same work. Our work in combination with the previous works [Nicolò Cesa{-}Bianchi et al., 2024; Nicolò Cesa-Bianchi et al., 2024; Yossi Azar et al., 2024; Martino Bernasconi et al., 2024] (essentially) gives a thorough understanding of regret minimization for fixed-price bilateral trade.
En route, we have developed two technical ingredients that might be of independent interest: (i) A novel algorithmic paradigm, called fractal elimination, to address one-bit feedback and independent values. (ii) A new lower-bound construction with novel proof techniques, to address the Global Budget Balance constraint and correlated values.