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| author | Paul <Paul@Pauls-MacBook-Air.local> | 2014-12-15 19:03:58 -0500 |
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| committer | Paul <Paul@Pauls-MacBook-Air.local> | 2014-12-15 19:03:58 -0500 |
| commit | cd1b1e9058966592eb80971d8e00fee9333e1c31 (patch) | |
| tree | 400e0ce2306bce246f6ece80eea1d16ef73f238a /project2/main.tex | |
| parent | dd13f5b0d7afd397b5207a4b5994c8e61ed97163 (diff) | |
| download | econ2099-cd1b1e9058966592eb80971d8e00fee9333e1c31.tar.gz | |
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Diffstat (limited to 'project2/main.tex')
| -rw-r--r-- | project2/main.tex | 11 |
1 files changed, 6 insertions, 5 deletions
diff --git a/project2/main.tex b/project2/main.tex index 96a1d6b..8b29b5b 100644 --- a/project2/main.tex +++ b/project2/main.tex @@ -50,7 +50,7 @@ -\section{Introduction} +\section{Introduction to the Problem} \blfootnote{We are deeply grateful to Jason Hartline who provided the original idea for this project.}We consider the problem of selling $m$ heterogeneous items to a single agent with additive utility. The type $t$ of the agent is drawn from a distribution @@ -105,10 +105,6 @@ Problem~\ref{eq:opt}: which expresses the assumption that the ex-ante allocation rule is upper-bounded by $\hat{x}$. -To provide some more intuition about this, we assume that the buyer is charged a price $p_0$ to participate in the mechanism, -and then is offered a menu of goods with prices $p_1,...,p_m$. The buyer's utility over the goods is additive, as above. However, there is an ex-ante constraint of being allocated a given good $i$, given by $\hat{x}_i$. For each good, if the buyer is allocated the good, which he is with probability $x_i \leq \hat{x}_i$, then he pays $p_i$; otherwise, he pays nothing. This is essentially the concept of a two-part tariff, as discussed in \cite{armstrong}. - - We use the notation from \cite{alaei} where $R(\hat{x})$ denotes the revenue obtained by the optimal mechanism solution to Problem~\ref{eq:opt} with ex-ante allocation constraint $\hat{x}$. \eqref{eq:ea}. @@ -117,6 +113,7 @@ solution to Problem~\ref{eq:opt} with ex-ante allocation constraint $\hat{x}$. there a simple mechanism whose ex-ante allocation rule is upper-bounded by $\hat{x}$ and whose revenue is a constant approximation to $R(\hat{x})$?} +\section{Importance of the Problem and Possible Approach} \paragraph{} One reason why one might want to consider this problem is that it can be used as a building block for more general mechanisms. Indeed, in \cite{alaei}, Alaei shows that under fairly general assumptions, given an @@ -126,6 +123,10 @@ for the multi-agent problem which is a $\gamma\cdot\alpha$ approximation to the revenue-optimal mechanism where $\gamma$ is a constant which is at least $\frac{1}{2}$. + +To provide some more intuition about this, we assume that the buyer is charged a price $p_0$ to participate in the mechanism, +and then is offered a menu of goods with prices $p_1,...,p_m$. The buyer's utility over the goods is additive, as above. However, there is an ex-ante constraint of being allocated a given good $i$, given by $\hat{x}_i$. For each good, if the buyer is allocated the good, which he is with probability $x_i \leq \hat{x}_i$, then he pays $p_i$; otherwise, he pays nothing. This is essentially the concept of a two-part tariff, as discussed in \cite{armstrong}. + It is interesting to consider two specific cases for which we already have an answer to our problem: \begin{itemize} |
