The menu-size complexity of revenue approximation

Moshe Babaioff, Yannai A. Gonczarowski and Noam Nisan

Games and Economic Behavior, 2022, vol. 134, issue C, 281-307

Abstract: Consider a monopolist selling n items to an additive buyer whose item values are drawn from independent distributions F1,F2,…,Fn possibly having unbounded support. Unlike in the single-item case, it is well known that the revenue-optimal selling mechanism (a pricing scheme) may be complex, sometimes requiring a continuum of menu entries. Also known is that simple mechanisms with a bounded number of menu entries can extract a constant fraction of the optimal revenue. Nonetheless, whether an arbitrarily high fraction of the optimal revenue can be extracted via a bounded menu size remained open.

Keywords: Mechanism design; Revenue maximization; Approximate revenue maximization; Menu size; Auction; Communication complexity (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:134:y:2022:i:c:p:281-307

DOI: 10.1016/j.geb.2021.03.001

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