Allocating Positional Goods: A Mechanism Design Approach
I study the optimal allocation of positional goods with externalities and one-sided transfers. Because consumers care about their relative positions in consumption, allocating an item to one buyer has externalities on others. Using a mechanism design approach, I characterize the externalities by a feasibility condition. I find the revenue-maximizing mechanism excludes some low types and fully separates the rest if and only if the buyer's type distribution satisfies Myerson's regularity. The seller can guarantee at least half the maximal revenue by offering one level of positional goods, and the approximation can be arbitrarily close if the distribution is sufficiently concave. Moreover, if the distribution has an increasing (decreasing) failure rate, total pooling (full separation) without exclusion maximizes the consumer surplus, and the consumer surplus is decreasing (increasing) in the number of positional good levels. Applications include education, priority services, luxury goods, and organizational design.
Code (0)
등록된 구현이 없습니다.
Similar Papers 제목 키워드 기반
No Screening is More Efficient with Multiple Objects
We study efficient mechanism design for allocating multiple heterogeneous objects. We aim to maximize the residual surplus, the total value generated from an allocation minus the costs for screening agents' values. We di…
SchedulingFairly Allocating Many Goods with Few Queries
We investigate the query complexity of the fair allocation of indivisible goods. For two agents with arbitrary monotonic utilities, we design an algorithm that computes an allocation satisfying envy-freeness up to one go…
Allocating Indivisible Goods to Strategic Agents: Pure Nash Equilibria and Fairness
We consider the problem of fairly allocating a set of indivisible goods to a set of strategic agents with additive valuation functions. We assume no monetary transfers and, therefore, a mechanism in our setting is an alg…
FairnessPROPm Allocations of Indivisible Goods to Multiple Agents
We study the classic problem of fairly allocating a set of indivisible goods among a group of agents, and focus on the notion of approximate proportionality known as PROPm. Prior work showed that there exists an allocati…
FairnessFair and Efficient Resource Allocation with Partial Information
We study the fundamental problem of allocating indivisible goods to agents with additive preferences. We consider eliciting from each agent only a ranking of her $k$ most preferred goods instead of her full cardinal valu…
Fairness