Revenue Equivalence, Profit Maximization, and Information Disclosure in Dynamic Mechanisms

two mechanisms that implement the same allocation rule must yield the same expected payoffs to the agents and hence the same expected revenue regardless of the transfer scheme and of the information disclosed by the mechanism to the agents. We then use the result as a tool for designing profit maximizing mechanisms. As an example of the applications we analyze the problem of designing a profit-maximizing sequence of auctions when the bidders' types follow a linear AR(1)-process.