Optimal Mechanisms for an Auction Mediator

Alexander Matros () and Andriy Zapechelnyuk

Discussion Paper Series from Center for Rationality and Interactive Decision Theory, Hebrew University, Jerusalem

Abstract: We consider a multi-period auction with a seller who has a single object for sale, a large population of potential buyers, and a mediator of the trade. The seller and every buyer have independent private values of the object. The mediator designs an auction mechanism which maximizes her revenue subject to certain constraints for the traders. In each period the seller auctions the object to a set of buyers drawn at random from the population. The seller can re-auction the object (infinitely many times) if it is not sold in previous interactions. We characterize the class of mediator-optimal auction mechanisms. One of such mechanisms is a Vickrey auction with a reserve price where the seller pays to the mediator a fixed percentage from the closing price.

New Economics Papers: this item is included in nep-gth
Date: 2006-06
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Related works:
Working Paper: Optimal Mechanisms for an Auction Mediator (2006)
Working Paper: Optimal Mechanisms for an Auction Mediator (2006)
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