Arbeitspapier | Working paper

Economic recommendation with surplus maximization

A prime function of many major World Wide Web applications is Online Service Allocation (OSA), the function of matching individual consumers with particular services/goods (which may include loans or jobs as well as products) each with its own producer. In the applications of interest, consumers are free to choose, so OSA usually takes the form of personalized recommendation or search in practice. The performance metrics of recommender and search systems currently tend to focus on just one side of the match, in some cases the consumers (e.g. satisfaction) and in other cases the producers (e.g., profit). However, a sustainable OSA platform needs benefit both consumers and producers; otherwise the neglected party eventually may stop using it. In this paper, we show how to adapt economists' traditional idea of maximizing total surplus (the sum of consumer net benefit and producer profit) to the heterogeneous world of online service allocation, in an effort to promote the web intelligence for social good in online eco-systems. Modifications of traditional personalized recommendation algorithms enable us to apply Total Surplus Maximization (TSM) to three very different types of real-world tasks - e-commerce, P2P lending and freelancing. The results for all three tasks suggest that TSM compares very favorably to currently popular approaches, to the benefit of both producers and consumers.

Economic recommendation with surplus maximization

Urheber*in: Zhang, Yongfeng; Zhao, Qi; Zhang, Yi; Friedman, Daniel; Zhang, Min; Liu, Yiqun; Ma, Shaoping

Free access - no reuse

0
/
0

Extent
Seite(n): 16
Language
Englisch
Notes
Status: Veröffentlichungsversion

Bibliographic citation
Discussion Papers / Wissenschaftszentrum Berlin für Sozialforschung, Forschungsschwerpunkt Markt und Entscheidung, Forschungsprofessur Market Design: Theory and Pragmatics (SP II 2016-502)

Subject
Publizistische Medien, Journalismus,Verlagswesen
Wirtschaft
interaktive, elektronische Medien
Volkswirtschaftstheorie
Online-Dienst
Konsumverhalten
Verbraucher
Entscheidungsfindung
Produzent
Algorithmus

Event
Geistige Schöpfung
(who)
Zhang, Yongfeng
Zhao, Qi
Zhang, Yi
Friedman, Daniel
Zhang, Min
Liu, Yiqun
Ma, Shaoping
Event
Veröffentlichung
(who)
Wissenschaftszentrum Berlin für Sozialforschung gGmbH
(where)
Deutschland, Berlin
(when)
2016

Handle
Rights
GESIS - Leibniz-Institut für Sozialwissenschaften. Bibliothek Köln
Last update
21.06.2024, 4:26 PM CEST

Data provider

This object is provided by:
GESIS - Leibniz-Institut für Sozialwissenschaften. Bibliothek Köln. If you have any questions about the object, please contact the data provider.

Object type

  • Arbeitspapier

Associated

  • Zhang, Yongfeng
  • Zhao, Qi
  • Zhang, Yi
  • Friedman, Daniel
  • Zhang, Min
  • Liu, Yiqun
  • Ma, Shaoping
  • Wissenschaftszentrum Berlin für Sozialforschung gGmbH

Time of origin

  • 2016

Other Objects (12)