Price discrimination in many-to-many matching markets

Arbeitspapier

We study second-degree price discrimination in markets where the product traded by the monopolist is access to other agents. We derive necessary and sufficient conditions for the welfare and the profit-maximizing mechanisms to employ a single network or a menu of non-exclusive networks. We characterize the optimal matching schedules under a wide range of preferences, derive implications for prices, and deliver testable predictions relating the structure of the optimal pricing strategies to conditions on the distribution of match qualities. Our analysis sheds light on the distortions associated with the private provision of broadcasting, health insurance and job matching services.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Discussion Paper ; No. 1540

Classification and Topics

• Classification: Wirtschaft ; Asymmetric and Private Information; Mechanism Design
• Subject: matching ; two-sided markets ; networks ; adverse selection ; incentives ; mechanism design

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Gomes, Renato ; Pavan, Alessandro
• Event: Veröffentlichung
• (who): Northwestern University, Kellogg School of Management, Center for Mathematical Studies in Economics and Management Science
• (where): Evanston, IL
• (when): 2011

Further information

• Handle: http://hdl.handle.net/10419/59671
• Last update: 10.03.2025, 11:45 AM CET