A smart market is a periodic auction which is cleared by the operations research technique of mathematical optimization, such as linear programming. The smart market is operated by a market manager. Trades are not bilateral, between pairs of people, but rather to or from a pool. A smart market can assist market operation when trades would otherwise have significant transaction costs or externalities.
Most other types of auctions can be cleared by a simple process of sorting bids from lowest to highest. Goods may be divisible, as with milk or flour, or indivisible, as with paintings or houses. Finding a market-clearing allocation corresponds to solution of a simple knapsack problem, and does not require much computation. By contrast, a smart market allows market clearing with arbitrary constraints. During market design, constraints are selected to match the relevant physics and economics of the allocation problem. A good overview is given in McCabe et al. (1991).[1]
Combinatorial auctions are smart markets in which goods are indivisible,[2] but some smart markets allocate divisible goods such as electricity and natural gas.
Compared to traditional market structures, a smart market substantially reduces transaction costs, allows competition which would not be possible otherwise, and can eliminate externalities. Despite complex constraints, a smart market allows the benefits of a modern financial exchange system. Fulfilment of the contract is backed by the exchange; parties are generally anonymous; the market manager enforces regulation to ensure fairness and transparency; and markets are orderly, especially during stressful conditions.
A smart market may be a one-sided auction in which participants buy from the market manager, a one-sided procurement (reverse auction) in which participants sell to the market manager, or two-sided, in which the market manager balances supplying participants with demanding participants. In a two-sided smart market, the market manager may be a net seller, a net buyer, or simply a revenue-neutral broker.
Smart markets are achievable due to an enabling confluence of technologies: the internet to transmit users’ bids and the resulting prices and quantities, increased computation power to run the simulation and linear program, and real time monitoring.
^McCabe, Kevin, Stephen Rassenti, and Vernon Smith (1991). Smart computer-assisted markets. Science. 254 534-538.
^Pekec, Aleksandar and Michael H. Rothkopf (2003), Combinatorial Auction Design, MANAGEMENT SCIENCE, Vol. 49, No. 11, November 2003, pp. 1485-1503.
Until 2002, the Fortwo had been marketed as the smart City-Coupé. Development of what ultimately became the Smart Fortwo started before 1993, originally...
Japanese market, such as mobile payments and shopping, near-field communication (NFC) allowing mobile wallet functionality to replace smart cards for...
knowledge that they offer. Deakin defines the smart city as one that utilizes ICT to meet the demands of the market (the citizens of the city), and states that...
electric vehicle platform developed by Geely. In China, the model is marketed as the Smart Jingling #1 (Chinese: 精灵#1; lit. 'Elf #1'). The production version...
The Smart Forfour (stylized as "smart forfour") is a city car (A-segment) marketed by Smart over two generations. The first generation was marketed in...
A smart TV, also known as a connected TV (CTV), is a traditional television set with integrated Internet and interactive Web 2.0 features that allow users...
CS1 maint: multiple names: authors list (link) Graham, Smart and Megginson op cit p. 387. "Market Capitalization Definition". Retrieved April 2, 2013. "Financial...
Look up smarts in Wiktionary, the free dictionary. Smarts may refer to: SMARTS, market analysis and surveillance software by Nasdaq Smiles arbitrary target...
competition in the market as part of the reason for restructuring. In 2016, SMART Technologies Inc. was acquired by Foxconn for $200 million. "SMART Technologies...
that smart meter shipments were 17.4 million units for the first quarter of 2011. Visiongain determined that the value of the global smart meter market would...
A smart card (SC), chip card, or integrated circuit card (ICC or IC card), is a card used to control access to a resource. It is typically a plastic credit...
them. Where opposition to smart meters is encountered, they are often marketed as "smart grid" which connects smart grid to smart meters in the eyes of opponents...
The Xiaomi Smart Band 8 is a wearable activity tracker produced by Xiaomi Inc. It was launched in China on 18 April 2023 and on 26 October 2023 for the...
A smart contract is a computer program or a transaction protocol that is intended to automatically execute, control or document events and actions according...
include home security such as access control and alarm systems. The phrase smart home refers to home automation devices that have internet access. Home automation...
2020, Infinix Mobility introduced its first range of smart TVs to the Nigerian electronics market. List of Infinix mobile phones: Infinix Zero 3 Infinix...
French Smartville factory. The Formore was to be Smart's first official entry in the United States market as a Mini SUV that seats 4–5. However, DaimlerChrysler...
the Dumb SmartMarket) by James Surowiecki in 1999. Here, Surowiecki differentiated from the EMH stating that it "doesn't mean that markets are always...
physically upgrade the ordinary lock. Recently, smart locking controllers have also appeared at the market. Smart locks, like the traditional locks, need two...
The Smart EQ Fortwo, formerly Smart Fortwo electric drive, smart ed or Smart Fortwo EV, is a battery electric vehicle variant of the Smart Fortwo city...
The term smart grid is most commonly defined as an electric grid that has been digitized to enable two way communication between producers and consumers...
A smart speaker is a type of loudspeaker and voice command device with an integrated virtual assistant that offers interactive actions and hands-free...
Samsung smart televisions and smart monitors run an operating system customized from the open-source Linux-based Tizen OS. Given Samsung's high market share...
ROH-koo) is a brand of smart TV operating systems, smart TVs, streaming devices, and smart home and audio products designed and marketed by Roku, Inc., headquartered...
Some smart doorbells also allow the user to open the door remotely using a smart lock. One of the earliest smart doorbells that entered to the market is...
Global Information