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
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.
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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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