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Disclosure and pricing of attributes

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  • Alex Smolin

Abstract

A monopolist sells an object characterized by multiple attributes. A buyer can be one of many types, differing in their willingness to pay for each attribute. The seller can provide arbitrary attribute information in the form of a statistical experiment. To screen different types, the seller offers a menu of options that specify information prices, experiments, and object prices. I characterize revenue‐maximizing menus. All experiments belong to a class of linear disclosure rules. An optimal menu may be nondiscriminatory. The analysis highlights the importance of demand microstructure and the benefits of information control in trade settings.

Suggested Citation

  • Alex Smolin, 2023. "Disclosure and pricing of attributes," RAND Journal of Economics, RAND Corporation, vol. 54(4), pages 570-597, December.
    • Handle: RePEc:bla:randje:v:54:y:2023:i:4:p:570-597
    DOI: 10.1111/1756-2171.12451
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    References listed on IDEAS

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    1. Samuelson, William F, 1984. "Bargaining under Asymmetric Information," Econometrica, Econometric Society, vol. 52(4), pages 995-1005, July.
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    Cited by:

    1. Levent Celik & Mikhail Drugov, 2021. "Score Disclosure," Working Papers w0285, New Economic School (NES).
    2. Pham, Hien, "undated". "a reprendre_ WP annulé," TSE Working Papers 21-1263, Toulouse School of Economics (TSE).
    3. Yingkai Li, 2021. "Selling Data to an Agent with Endogenous Information," Papers 2103.05788, arXiv.org, revised Aug 2023.
    4. Masaki Aoyagi & Maxime Menuet, 2024. "Incentive Compatible Information Disclosure," GREDEG Working Papers 2024-30, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    5. Daniel Kraehmer, 2018. "Full surplus extraction in mechanism design with information disclosure," CRC TR 224 Discussion Paper Series crctr224_011_2018, University of Bonn and University of Mannheim, Germany.
    6. Pham, Hien, 2023. "How Information Design Shapes Optimal Selling Mechanisms," MPRA Paper 120989, University Library of Munich, Germany, revised 06 Mar 2024.

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    More about this item

    JEL classification:

    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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