Maximal Revenue with Multiple Goods: Nonmonotonicity and Other Observations
Consider the problem of maximizing the revenue from selling a number of goods to a single buyer. We show that, unlike the case of one good, when the buyer's values for the goods increase the seller's maximal revenue may well decrease. We also provide a characterization of revenue-maximizing mechanisms (more generally, of "seller-favorable" mechanisms) that circumvents nondifferentiability issues. Finally, through simple and transparent examples, we clarify the need for and the use of randomization when maximizing revenue in the multiple-goods versus the one-good case.
|Date of creation:||Nov 2012|
|Contact details of provider:|| Postal: Feldman Building - Givat Ram - 91904 Jerusalem|
Web page: http://www.ratio.huji.ac.il/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Rochet, J. C., 1985. "The taxation principle and multi-time Hamilton-Jacobi equations," Journal of Mathematical Economics, Elsevier, vol. 14(2), pages 113-128, April.
- Krishna, Vijay & Maenner, Eliot, 2001. "Convex Potentials with an Application to Mechanism Design," Econometrica, Econometric Society, vol. 69(4), pages 1113-1119, July.
- Manelli, Alejandro M. & Vincent, Daniel R., 2007.
"Multidimensional mechanism design: Revenue maximization and the multiple-good monopoly,"
Journal of Economic Theory,
Elsevier, vol. 137(1), pages 153-185, November.
- Alejandro M. Manelli & Daniel R. Vincent, 2004. "Multidimensional Mechanism Design: Revenue Maximization and the Multiple-Good Monopoly," Working Papers 2004.153, Fondazione Eni Enrico Mattei.
- Sergiu Hart & Noam Nisan, 2012.
"Approximate Revenue Maximization with Multiple Items,"
Discussion Paper Series
dp606, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.
- Sergiu Hart & Noam Nisan, 2012. "Approximate Revenue Maximization with Multiple Items," Levine's Working Paper Archive 786969000000000433, David K. Levine.
- Motty Perry & Philip J. Reny, 1999. "On The Failure of the Linkage Principle in Multi-Unit Auctions," Econometrica, Econometric Society, vol. 67(4), pages 895-900, July.
- Pavlov Gregory, 2011.
"Optimal Mechanism for Selling Two Goods,"
The B.E. Journal of Theoretical Economics,
De Gruyter, vol. 11(1), pages 1-35, February.
- Sergiu Hart & Noam Nisan, 2014. "How Good Are Simple Mechanisms for Selling Multiple Goods?," Discussion Paper Series dp666, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.
- Manelli, Alejandro M. & Vincent, Daniel R., 2012. "Multidimensional mechanism design: Revenue maximization and the multiple-good monopoly. A corrigendum," Journal of Economic Theory, Elsevier, vol. 147(6), pages 2492-2493.
- Menicucci Domenico, 2009. "Competition May Reduce the Revenue in a First Price Auction with Affiliated Private Values," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 9(1), pages 1-19, December.
- Manelli, Alejandro M. & Vincent, Daniel R., 2006. "Bundling as an optimal selling mechanism for a multiple-good monopolist," Journal of Economic Theory, Elsevier, vol. 127(1), pages 1-35, March.
- Thanassoulis, John, 2004. "Haggling over substitutes," Journal of Economic Theory, Elsevier, vol. 117(2), pages 217-245, August.
When requesting a correction, please mention this item's handle: RePEc:huj:dispap:dp630. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Tomer Siedner)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.