Surplus extraction with rich type spaces
AbstractWe characterize revenue maximizing mechanisms in auction settings with ‘rich’ type spaces, where bidders obtain information from sources other than their own valuation. By considering a relaxed problem, we provide an upper bound on revenue extraction that explicitly builds on the richness of the information structure. We provide a condition under which this upper bound is achieved and describe an optimal mechanism. Under this condition, we also show that the optimal revenue can be achieved through dominant strategy implementation.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Theory.
Volume (Year): 148 (2013)
Issue (Month): 6 ()
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Web page: http://www.elsevier.com/locate/inca/622869
Surplus extraction; Information rents; Mechanism design; Private information; Correlated information; Partial implementation;
Find related papers by JEL classification:
- C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
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