The Optimal Mechanism for Selling to Budget-Constrained Consumers.

This paper finds an optimal mechanism for selling an indivisible good to consumers who may be budget-constrained. Unlike the case where buyers are not budget constrained, a single posted price is not typically optimal. An optimal mechanism generally consists of a continuum of lotteries indexed by the probability of comsumption and the entry fee.

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Year of publication:	1996
Authors:	Che, Y.K. ; Gale, I.
Institutions:	Wisconsin Madison - Social Systems
Subject:	CONSUMPTION \| MONOPOLIES \| INFORMATION

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Series:	Working papers.
Type of publication:	Book / Working Paper
Classification:	D40 - Market Structure and Pricing. General ; D42 - Monopoly ; D80 - Information and Uncertainty. General ; D82 - Asymmetric and Private Information
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005200406