Weekly Economics Seminar by Sushil Bikhchandani
March 4 @ 1:30 pm - 2:40 pm
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Title: Selling Identical Objects
Speaker: Sushil Bikhchandani, Professor of Economics, Anderson School of Management, UCLA
Abstract: We investigate optimal selling mechanisms for identical objects. We analyze two settings: (i) decreasing marginal values and (ii) increasing marginal values. Thus, buyer values are neither additive nor independent. With decreasing marginal values, we show that under a sufficient condition it is optimal to sell the first unit deterministically. We describe other properties of optimal mechanisms and use these results to show that for two units and the uniform prior there is an optimal mechanism that is deterministic. With increasing marginal values, the optimal mechanism for selling two units is deterministic and involves bundling under the same sufficient condition.