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Ichihashi, Shota, Jeon, Doh-Shin
and Kim, Byung-Cheol
(2024)
Mechanism Design and Innovation Incentive for an Ad-Funded Platform.
TSE Working Paper, n. 24-1591, Toulouse
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Abstract
We study a mechanism design problem of a monopoly platform that matches content of varying quality, ads with dierent 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 negative virtual values while, to reduce information rents, limiting their access to higher-quality content. Then, an increase in ad protability reduces its incentive to invest in content quality.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Language: | English |
| Date: | November 2024 |
| Place of Publication: | Toulouse |
| Uncontrolled Keywords: | ad-funded platform, mechanism design, matching, innovation |
| JEL Classification: | D42 - Monopoly D82 - Asymmetric and Private Information L15 - Information and Product Quality; Standardization and Compatibility O31 - Innovation and Invention - Processes and Incentives |
| Subjects: | B- ECONOMIE ET FINANCE |
| Divisions: | TSE-R (Toulouse) |
| Institution: | Université Toulouse Capitole |
| Site: | UT1 |
| Date Deposited: | 15 Nov 2024 08:33 |
| Last Modified: | 18 Feb 2025 09:25 |
| OAI Identifier: | oai:tse-fr.eu:129923 |
| URI: | https://publications.ut-capitole.fr/id/eprint/49845 |
