Vickrey Auction

A Vickrey auction is a type of sealed-bid auction where bidders submit written bids without knowing others' offers. The highest bidder wins but pays the second-highest bid instead of their own. This encourages truthful bidding, as bidders have an incentive to bid their true value for the item, knowing they won't pay more than the next highest bid. The auction promotes fair competition and can lead to more efficient pricing, as it reflects the true market value. Overall, it emphasizes honesty while protecting bidders from overpaying.