Maximal Revenue with Multiple Goods: Nonmonotonicity and Other Observations

Sergiu Hart and Philip Reny ()

Discussion Paper Series from The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem

Abstract: 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.

Pages: 24 pages
Date: 2012-11
New Economics Papers: this item is included in nep-mic
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Maximal revenue with multiple goods: nonmonotonicity and other observations (2015)
Working Paper: Maximal Revenue with Multiple Goods: Nonmonotonicity and Other Observations (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:huj:dispap:dp630

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