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A Dynamic Mechanism Design for Scheduling with Different Use Lengths

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  • Ryuji Sano

    (Institute of Economic Research, Kyoto University)

Abstract

This paper considers a dynamic allocation problem in which many perishable goods are allocated at each period. Agents want to keep winning goods for more than one period to make profits. We consider efficient and optimal mechanisms when the seller offers simple long-term contracts. The dynamic VCG mechanism achieves efficient allocations. The expected revenue is maximized by the virtual welfare maximization. In the single unit case, price discounts for long-stay agents can be optimal under certain distributions. Both the efficient and optimal mechanisms are implemented by a simple “handicap auction†in the binary length case.

Suggested Citation

  • Ryuji Sano, 2015. "A Dynamic Mechanism Design for Scheduling with Different Use Lengths," KIER Working Papers 924, Kyoto University, Institute of Economic Research.
    • Handle: RePEc:kyo:wpaper:924
    as

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    File URL: http://www.kier.kyoto-u.ac.jp/DP/DP924.pdf
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    References listed on IDEAS

    as
    1. Alex Gershkov & Benny Moldovanu, 2009. "Dynamic Revenue Maximization with Heterogeneous Objects: A Mechanism Design Approach," American Economic Journal: Microeconomics, American Economic Association, vol. 1(2), pages 168-198, August.
    2. Thomas Kittsteiner & Benny Moldovanu, 2005. "Priority Auctions and Queue Disciplines That Depend on Processing Time," Management Science, INFORMS, vol. 51(2), pages 236-248, February.
    3. Said, Maher, 2012. "Auctions with dynamic populations: Efficiency and revenue maximization," Journal of Economic Theory, Elsevier, vol. 147(6), pages 2419-2438.
    4. Simon Board & Andrzej Skrzypacz, 2016. "Revenue Management with Forward-Looking Buyers," Journal of Political Economy, University of Chicago Press, vol. 124(4), pages 1046-1087.
    5. , & , & ,, 2011. "Revenue maximization in the dynamic knapsack problem," Theoretical Economics, Econometric Society, vol. 6(2), May.
    6. Alessandro Pavan & Ilya Segal & Juuso Toikka, 2014. "Dynamic Mechanism Design: A Myersonian Approach," Econometrica, Econometric Society, vol. 82(2), pages 601-653, March.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    dynamic mechanism design; online mechanism; optimal auction;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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