TY - GEN
T1 - Pricing social goods
AU - Eden, Alon
AU - Ezra, Tomer
AU - Feldman, Michal
N1 - Funding Information:
∗ A full version of the paper is available at https://arxiv.org/abs/1706.10009. † This work was partially supported by the European Research Council under the European Union’s Seventh Framework Programme (FP7/2007-2013) / ERC grant agreement number 337122.
PY - 2017/9/1
Y1 - 2017/9/1
N2 - Social goods are goods that grant value not only to their owners but also to the owners' surroundings, be it their families, friends or office mates. The benefit a non-owner derives from the good is affected by many factors, including the type of the good, its availability, and the social status of the non-owner. Depending on the magnitude of the benefit and on the price of the good, a potential buyer might stay away from purchasing the good, hoping to free ride on others' purchases. A revenue-maximizing seller who sells social goods must take these considerations into account when setting prices for the good. The literature on optimal pricing has advanced considerably over the last decade, but little is known about optimal pricing schemes for selling social goods. In this paper, we conduct a systematic study of revenue-maximizing pricing schemes for social goods: We introduce a Bayesian model for this scenario, and devise nearly-optimal pricing schemes for various types of externalities, both for simultaneous sales and for sequential sales.
AB - Social goods are goods that grant value not only to their owners but also to the owners' surroundings, be it their families, friends or office mates. The benefit a non-owner derives from the good is affected by many factors, including the type of the good, its availability, and the social status of the non-owner. Depending on the magnitude of the benefit and on the price of the good, a potential buyer might stay away from purchasing the good, hoping to free ride on others' purchases. A revenue-maximizing seller who sells social goods must take these considerations into account when setting prices for the good. The literature on optimal pricing has advanced considerably over the last decade, but little is known about optimal pricing schemes for selling social goods. In this paper, we conduct a systematic study of revenue-maximizing pricing schemes for social goods: We introduce a Bayesian model for this scenario, and devise nearly-optimal pricing schemes for various types of externalities, both for simultaneous sales and for sequential sales.
KW - Externalities
KW - Posted prices
KW - Public goods
KW - Revenue maximization
UR - http://www.scopus.com/inward/record.url?scp=85030526449&partnerID=8YFLogxK
U2 - 10.4230/LIPIcs.ESA.2017.35
DO - 10.4230/LIPIcs.ESA.2017.35
M3 - ???researchoutput.researchoutputtypes.contributiontobookanthology.conference???
AN - SCOPUS:85030526449
T3 - Leibniz International Proceedings in Informatics, LIPIcs
BT - 25th European Symposium on Algorithms, ESA 2017
A2 - Sohler, Christian
A2 - Sohler, Christian
A2 - Pruhs, Kirk
PB - Schloss Dagstuhl- Leibniz-Zentrum fur Informatik GmbH, Dagstuhl Publishing
T2 - 25th European Symposium on Algorithms, ESA 2017
Y2 - 4 September 2017 through 6 September 2017
ER -