DP19675 Mechanism Design and Innovation Incentive for an Ad-Funded Platform

Advertising

We study a mechanism design problem of a monopoly platform that matches content of varying quality, ads with different ad revenues, and consumers with heterogeneous tastes for content quality. The optimal mechanism balances revenue from advertising and revenue from selling access to content: Increasing advertising revenue requires serving content to more consumers, which may reduce access revenue. Contrary to the standard monopolistic screening, the platform may serve content to consumers with

Tag-uri: Advertising

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