Pricing social goods

DOI10.4230/LIPICS.ESA.2017.35MaRDI QIDQ5111722zbMATH OpenOpenAlexFDO

Authors Alon Eden, Tomer Ezra, Michal Feldman

Publication date 27 May 2020

Full work available at URL https://arxiv.org/abs/1706.10009

zbMATH Keywords

revenue maximizationexternalitiespublic goodsposted prices

Mathematics Subject Classification ID

Public goods (91B18)

Abstract: Social goods are goods that grant value not only to their owners but also to the owners' surroundings, be it their families, friends or office mates. The benefit a non-owner derives from the good is affected by many factors, including the type of the good, its availability, and the social status of the non-owner. Depending on the magnitude of the benefit and on the price of the good, a potential buyer might stay away from purchasing the good, hoping to free ride on others' purchases. A revenue-maximizing seller who sells social goods must take these considerations into account when setting prices for the good. The literature on optimal pricing has advanced considerably over the last decade, but little is known about optimal pricing schemes for selling social goods. In this paper, we conduct a systematic study of revenue-maximizing pricing schemes for social goods: we introduce a Bayesian model for this scenario, and devise nearly-optimal pricing schemes for various types of externalities, both for simultaneous sales and for sequential sales.

Recommendations

• Pricing to maximize revenue and welfare simultaneously in large markets
• Optimal pricing in networks with externalities
• Pricing in social networks
• Equilibrium pricing with positive externalities
• Limiting Price Discrimination when Selling Products with Positive Network Externalities

Cites work

• Bayesian Combinatorial Auctions: Expanding Single Buyer Mechanisms to Many Buyers
• Combinatorial auctions via posted prices
• Equilibrium pricing with positive externalities
• Matroid prophet inequalities
• Microeconomic theory
• Multi-parameter mechanism design and sequential posted pricing
• Optimal Auction Design
• Optimal auctions vs. anonymous pricing
• Optimal pricing in networks with externalities

Cited in

(4)

• On the difference between social and private goods
• Excludable public goods: pricing and social welfare maximization
• SOCIAL COMMON CAPITAL, IMPUTED PRICE, AND SUSTAINABLE DEVELOPMENT
• A better <scp>buy‐one‐give‐one</scp> business model

This page was built for publication: Pricing social goods

Report a bug (only for logged in users!)Click here to report a bug for this page (MaRDI item Q5111722)