Chapter 68 The Combinatorial Auction This chapter summarizes a market mechanism for a combinatorial sealed bid auction that was motivated by the airport slot problem under which bidders would submit bids for packages of slots that support their schedules. Under this scheme the elemental resources would be allocated only in the form of those combinations desired by the bidders. Under this scenario the purpose of an aftermarket would be to adjust for allocation errors in the primary market (the objective in the experiments reported below) or to adjust for post primary market changes in demand. Although this form of combinatorial auction was never applied to airport runway rights the issue of pricing runway slots has arisen in the new century as a means of managing airport congestion. The combinatorial procedure below is not generally incentive compatible; i.e. if any bidder desires multiple units of either packages or elements or multiple units of any element then it may be to a bidders advantage to strategically underbid the true value of a package.