The Combinatorial Retention Auction Mechanism (CRAM)
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We propose a reverse uniform price auction called Combinatorial Retention Auction Mechanism (CRAM) that integrates both monetary and non-monetary incentives (NMIs). CRAM computes the cash bonus and NMIs to a single cost parameter, retains the lowest cost employees and provides them with compensation equal to the cost of the first excluded employee. CRAM is dominant strategy incentive compatible. We provide optimal bidding strategy, and show that there is cost saving compared to a benchmark auction (monetary retention auction). Because CRAM and the benchmark may retain different employees, we provide for whom and under what conditions the utility may increase or decrease by CRAM. Finally, we show that there is an increase in the total social welfare by utilizing CRAM to the benchmark.
NPS Report NumberNPS-GSBPP-13-004
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Integrating monetary and non-monetary retention incentives for the U.S. Navy Dental Corps officers utilizing the Combinatorial Retention Auction Mechanism (CRAM) Kumar, Sandeep (Monterey, California. Naval Postgraduate School, 2010-03);This research focused on the Navy Dental Corps community because of the retention challenges encountered, especially at the senior Lieutenant and Lieutenant Commander Ranks. The Dental Corps has retention goals by accession ...
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