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Position auctions with dynamic resizing

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  • Hummel, Patrick

Abstract

This paper analyzes mechanisms for selling advertising inventory in a position auction in which displaying less than the maximal number of ads means the ads that are shown can be dynamically resized and displayed more prominently. I characterize the optimal mechanism with and without dynamic resizing, and illustrate how the optimal reserve prices in a Vickrey–Clarke–Groves mechanism vary with the amount of dynamic resizing and the number of bidders.

Suggested Citation

  • Hummel, Patrick, 2016. "Position auctions with dynamic resizing," International Journal of Industrial Organization, Elsevier, vol. 45(C), pages 38-46.
    • Handle: RePEc:eee:indorg:v:45:y:2016:i:c:p:38-46
    DOI: 10.1016/j.ijindorg.2015.12.002
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    References listed on IDEAS

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    Cited by:

    1. Patrick Hummel, 2018. "How do selling mechanisms affect profits, surplus, capacity and prices with unknown demand?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 51(1), pages 94-126, February.

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    More about this item

    Keywords

    Position auctions; Dynamic resizing; Reserve prices; Mechanism design; Online advertising; Vickrey–Clarke–Groves;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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