Robust screening under ambiguity
Date
2017Source Title
Mathematical Programming
Print ISSN
0025-5610
Electronic ISSN
1436-4646
Publisher
Springer
Volume
163
Issue
1-2
Pages
273 - 299
Language
English
Type
ArticleItem Usage Stats
190
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views
229
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downloads
Abstract
We consider the problem of screening where a seller puts up for sale an indivisible good, and a buyer with a valuation unknown to the seller wishes to acquire the good. We assume that the buyer valuations are represented as discrete types drawn from some distribution, which is also unknown to the seller. The seller is averse to possible mis-specification of types distribution, and considers the unknown type density as member of an ambiguity set and seeks an optimal pricing mechanism in a worst case sense. We specify four choices for the ambiguity set and derive the optimal mechanism in each case.
Keywords
AmbiguityMechanism design
Pricing
Robust optimization
Screening
Costs
Machine design
Screening
Ambiguity
Ambiguity set
Indivisible good
Mechanism design
Optimal mechanism
Optimal pricing
Robust optimization
Types distributions
Optimization
Permalink
http://hdl.handle.net/11693/36365Published Version (Please cite this version)
http://dx.doi.org/10.1007/s10107-016-1063-xCollections
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