TY - JOUR
T1 - Matching auctions
AU - Fershtman, Daniel
AU - Pavan, Alessandro
N1 - Publisher Copyright:
© 2022, The RAND Corporation.
PY - 2022/3/1
Y1 - 2022/3/1
N2 - We study platform markets in which agents arrive gradually, experience changes to their preferences over time, and are frequently re-matched. We introduce simple auctions specifically designed for such markets. Upon joining, agents select a status that determines the weight assigned to their future bids. Each match is then assigned a score that depends on the agents' reciprocal bids and status. The matches maximizing the sum of the bilateral scores are implemented. Under certain conditions, such auctions maximize profits, welfare, or a combination of the two. We use the results to shed light on the distortions due to platforms' market power.
AB - We study platform markets in which agents arrive gradually, experience changes to their preferences over time, and are frequently re-matched. We introduce simple auctions specifically designed for such markets. Upon joining, agents select a status that determines the weight assigned to their future bids. Each match is then assigned a score that depends on the agents' reciprocal bids and status. The matches maximizing the sum of the bilateral scores are implemented. Under certain conditions, such auctions maximize profits, welfare, or a combination of the two. We use the results to shed light on the distortions due to platforms' market power.
UR - http://www.scopus.com/inward/record.url?scp=85123260537&partnerID=8YFLogxK
U2 - 10.1111/1756-2171.12399
DO - 10.1111/1756-2171.12399
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AN - SCOPUS:85123260537
SN - 0741-6261
VL - 53
SP - 32
EP - 62
JO - RAND Journal of Economics
JF - RAND Journal of Economics
IS - 1
ER -