Reproduce “Single-Item Auctions with a Monopolist Intermediary” on OpenResearch
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About this paper
Jingyi Liu, Aviad Rubinstein, Ertem Nusret Tas, S. Matthew Weinberg, Qianfan Zhang
This research analyzes single-item auctions featuring a monopolistic intermediary that controls access to the seller, quantifying the revenue consequences for both parties under various strategic timing models. It demonstrates that while seller revenue can be arbitrarily low under general bidder value distributions, a constant fraction of optimal revenue is recoverable for sellers when bidder distributions are sufficiently regular.
Key insights
- The introduction of a monopolistic intermediary fundamentally alters optimal auction design, effectively adding another layer of monopoly pricing.
- Strategic timing is crucial; the party with commitment power (the first mover) can often secure a constant fraction of the optimal revenue for broad distribution classes.
- Simultaneous strategic play can lead to significantly worse outcomes for both the seller and the intermediary compared to Stackelberg models, highlighting potential market inefficiencies.
Summary by alphaXiv.
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