Novel Double Auction Mechanisms for Agricultural Supply Chain Trading

Due to the deteriorated and obsolete nature, fresh produces generate a large amount of carbon emission, which has reduced the quality of modern life. This makes it important for agricultural supply chain trading (ASCT) to achieve efficient trading time and more social welfare based on efficient auctions. This paper is among the first contributions that incorporate bilateral bidding into auction mechanism design for produce trading problem. Two double auction mechanism are proposed to realize the optimal resource allocation and pricing of produce. This paper aims to realize efficient allocation and dynamic pricing in produce trading. We first consider a produce market with $m$ growers and $n$ sellers, and develop the multiunit nonreduction mechanism (MNR) and multi-unit trade reduction (MTR) mechanism in the market. According to the supply and demand relationship in the produce market, we consider two market scenarios of supply and demand oversupply, and overdemand, and formulated corresponding auction allocation and pricing rules. The two novel MUDA mechanisms have been constructed to allocate fresh produce with more reasonable prices in bilateral trade markets. Furthermore, a numerical study and analysis were considered to verify the effectiveness and efficiency of the two agricultural trading mechanisms. Numerical study results show that the proposed MTR mechanism can achieve efficient resource allocation.