Beyond the PPAD hardness of Auto-bidding Auctions

Abstract

Computing certain autobidding equilibria is PPAD complete in the worst case. Yet such instances rarely arise in practice, where advertisers running simple, decentralized learning strategies usually converge quickly. We show there is no contradiction: the hardness requires atomicity and vanishes once the value distribution is nonatomic, as it is in real world markets. To bridge worst case hardness and practical convergence, we introduce diffuse analysis, a beyond worst case framework that studies equilibrium computation when bidder values are drawn from general nonatomic distributions. Under this framework, the autobidding equilibrium becomes a separately monotone generalized Nash equilibrium (GNE). For this GNE, we give the first solver with last iterate linear convergence. Thus, the equilibrium has polynomial diffuse complexity, matching the convergence observed in real-world markets. Concretely, our framework subsumes the budget pacing and the throttling equilibrium as special cases when the payment rule is a convex combination of first and second price.