Optimal assignment of durable objects to successive agents

Francis Bloch and Nicolas Houy

Economic Theory, 2012, vol. 51, issue 1, 13-33

Abstract: This paper analyzes the assignment of durable objects to successive generations of agents who live for two periods. The optimal assignment rule is stationary, favors old agents and is determined by a selectivity function, which satisfies an iterative functional differential equation. More patient social planners are more selective, as are social planners facing distributions of types with higher probabilities for higher types. The paper also characterizes optimal assignment rules when monetary transfers are allowed and agents face a recovery cost, when multiple agents enter society, and when agents can invest to improve their types. Copyright Springer-Verlag 2012

Keywords: Dynamic assignment; Durable objects; Revenue management; Dynamic mechanism design; Overlapping generations; Promotions and intertemporal assignments; C78; D73; M51 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (23)

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Working Paper: Optimal Assignment of Durable Objects to Successive Agents (2009)
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DOI: 10.1007/s00199-011-0616-8

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