Tools
Tools
Jeon, Doh-Shin
, Ichihashi, Shota and Kim, Byung-Cheol
(2026)
Mechanism Design for Ad-Supported Platforms.
TSE Working Paper, n. 24-1591, Toulouse
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Abstract
Many digital platforms earn revenue by selling content access and displaying ads. We study monopoly screening by a platform allocating heterogeneous content and ads to heterogeneous consumers. Advertising generates revenue and affects information rents through nuisance, which alters the platform’s incentives to allocate content. The optimal mechanism balances a trade-off between advertising and rent extraction: Expanding content access increases advertising revenue but reduces sales revenue by raising information rents. The mechanism features novel distortions in content access and ad exposure, rationalizes contracts across ad-supported platforms, and explains why greater ad profitability may weaken incentives to invest in content quality.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Language: | English |
| Date: | 7 September 2026 |
| Place of Publication: | Toulouse |
| Uncontrolled Keywords: | ad-funded platform, mechanism design, innovation, quality |
| 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: | 09 Sep 2026 14:19 |
| OAI Identifier: | oai:tse-fr.eu:129923 |
| URI: | https://publications.ut-capitole.fr/id/eprint/49845 |
