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Can Credit Increase Revenue?

Conference paper
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Part of the Lecture Notes in Computer Science book series (LNCS, volume 8289)

Abstract

Classical models of private value auctions assume that bidders know their own private value for the item being auctioned. We explore games where players have a private value, but can only learn this value through experimentation, a scenario that is typical in AdAuctions. We consider this question in a repeated game context, where early participation in the auction can help the bidders learn their own value. We consider what is a good bidding strategy for a player in this game, and show that with low enough competition new bidders will enter and experiment, but with a bit higher level of competition, initial credit offered by the platform can encourage experimentation, and hence ultimately can increase revenue.

Keywords

auction learning revenue 

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Copyright information

© Springer-Verlag Berlin Heidelberg 2013

Authors and Affiliations

  1. 1.Indian Institute of TechnologyBombayIndia
  2. 2.Dept. of Computer ScienceCornell UniversityIthacaUSA

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