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A General Solution to the Quasi Linear Screening Problem

Author

Listed:
  • Guillaume Carlier

    (CEREMADE - CEntre de REcherches en MAthématiques de la DEcision - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique)

  • Xavier Dupuis

    (IMB - Institut de Mathématiques de Bourgogne [Dijon] - UB - Université de Bourgogne - CNRS - Centre National de la Recherche Scientifique)

  • Jean-Charles Rochet

    (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • John Thanassoulis

    (WBS - Warwick Business School - University of Warwick [Coventry], CEPR - Center for Economic Policy Research)

Abstract

We provide an algorithm for solving multidimensional screening problems which are intractable analytically. The algorithm is a primal-dual algorithm which al- ternates between optimising the primal problem of the surplus extracted by the principal and the dual problem of the optimal assignment to deliver to the agents for a given surplus. We illustrate the algorithm by solving (i) the generic monopolist price discrimination problem and (ii) an optimal tax problem covering income and savings taxes when citizens differ in multiple dimensions.

Suggested Citation

  • Guillaume Carlier & Xavier Dupuis & Jean-Charles Rochet & John Thanassoulis, 2024. "A General Solution to the Quasi Linear Screening Problem," Post-Print hal-04598698, HAL.
    • Handle: RePEc:hal:journl:hal-04598698
    DOI: 10.1016/j.jmateco.2024.103025
    Note: View the original document on HAL open archive server: https://hal.science/hal-04598698v1
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    References listed on IDEAS

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