Smolin, Alex (2019): Disclosure and Pricing of Attributes.
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Abstract
A monopolist sells an object characterized by multiple attributes. A buyer can be one of many types, differing in their willingness to pay for each attribute. The seller can disclose to the buyer arbitrary attribute information in the form of a statistical experiment. The seller decides how to price the object, what information to disclose, and how to price access to the information. To screen different types, the seller offers a menu of options that specify information prices, experiments, and object prices.
I characterize revenue-maximizing menus. If all types value the same attribute, then the seller cannot benefit from information disclosure and price discrimination. More generally, if each type values a single attribute and attributes are independent, then the seller can benefit from information disclosure but not from price discrimination. In other cases, a discriminatory menu can be profitable; however, optimal experiments always belong to a tractable class of linear disclosure policies. The analysis informs the operation of various intermediaries including business brokers and online recruiting platforms.
Item Type: | MPRA Paper |
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Original Title: | Disclosure and Pricing of Attributes |
Language: | English |
Keywords: | attributes, call options, demand transformation, information design, intermediaries, linear disclosure, mechanism design, multidimensional screening, persuasion |
Subjects: | D - Microeconomics > D1 - Household Behavior and Family Economics > D11 - Consumer Economics: Theory D - Microeconomics > D4 - Market Structure, Pricing, and Design > D42 - Monopoly D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information ; Mechanism Design D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search ; Learning ; Information and Knowledge ; Communication ; Belief ; Unawareness L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L15 - Information and Product Quality ; Standardization and Compatibility |
Item ID: | 91583 |
Depositing User: | Alex Smolin |
Date Deposited: | 21 Jan 2019 14:40 |
Last Modified: | 12 Oct 2024 07:22 |
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URI: | https://mpra.ub.uni-muenchen.de/id/eprint/91583 |
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Disclosure and Pricing of Attributes. (deposited 23 Jan 2018 15:26)
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