TY - JOUR
T1 - Matching auctions
AU - Fershtman, Daniel
AU - Pavan, Alessandro
N1 - Funding Information:
For helpful comments and suggestions, we are grateful to the Editor, Gary Biglaiser, anonymous referees, Dirk Bergemann, Yeon‐Koo Che, Eddie Dekel, Drew Fudenberg, Benjamin Hermalin, Terence Johnson, Fuhito Kojima, Benny Moldovanu, Larry Samuelson, Rakesh Vohra, Jean Tirole, Asher Wolinsky, Leeat Yariv, and seminar participants at various conferences and workshops where this work was presented. Matteo Camboni provided excellent research assistance. Pavan also thanks the National Science Foundation for financial support under the grant SES 1530798 and Bocconi University for its hospitality during the 2017–2018 academic year. Fershtman gratefully acknowledges funding by the German Research Foundation (DFG) through CRC TR 224 (Project B1). The usual disclaimer applies.
Publisher Copyright:
© 2022, The RAND Corporation.
PY - 2022/3/1
Y1 - 2022/3/1
N2 - We study platform markets in which agents arrive gradually, experience changes to their preferences over time, and are frequently re-matched. We introduce simple auctions specifically designed for such markets. Upon joining, agents select a status that determines the weight assigned to their future bids. Each match is then assigned a score that depends on the agents' reciprocal bids and status. The matches maximizing the sum of the bilateral scores are implemented. Under certain conditions, such auctions maximize profits, welfare, or a combination of the two. We use the results to shed light on the distortions due to platforms' market power.
AB - We study platform markets in which agents arrive gradually, experience changes to their preferences over time, and are frequently re-matched. We introduce simple auctions specifically designed for such markets. Upon joining, agents select a status that determines the weight assigned to their future bids. Each match is then assigned a score that depends on the agents' reciprocal bids and status. The matches maximizing the sum of the bilateral scores are implemented. Under certain conditions, such auctions maximize profits, welfare, or a combination of the two. We use the results to shed light on the distortions due to platforms' market power.
UR - http://www.scopus.com/inward/record.url?scp=85123260537&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85123260537&partnerID=8YFLogxK
U2 - 10.1111/1756-2171.12399
DO - 10.1111/1756-2171.12399
M3 - Article
AN - SCOPUS:85123260537
VL - 53
SP - 32
EP - 62
JO - RAND Journal of Economics
JF - RAND Journal of Economics
SN - 0741-6261
IS - 1
ER -