Can Buyers Reveal for a Better Deal?

Can Buyers Reveal for a Better Deal?

Daniel Halpern, Gregory Kehne, Jamie Tucker-Foltz

Proceedings of the Thirty-First International Joint Conference on Artificial Intelligence
Main Track. Pages 314-320. https://doi.org/10.24963/ijcai.2022/45

We study market interactions in which buyers are allowed to credibly reveal partial information about their types to the seller. Previous recent work has studied the special case of one buyer and one good, showing that such communication can simultaneously improve social welfare and ex ante buyer utility. However, with multiple buyers, we find that the buyer-optimal signalling schemes from the one-buyer case are actually harmful to buyer welfare. Moreover, we prove several impossibility results showing that, with either multiple i.i.d. buyers or multiple i.i.d. goods, maximizing buyer utility can be at odds with social efficiency, which is surprising in contrast with the one-buyer, one-good case. Finally, we investigate the computational tractability of implementing desirable equilibrium outcomes. We find that, even with one buyer and one good, optimizing buyer utility is generally NP-hard but tractable in a practical restricted setting.
Keywords:
Agent-based and Multi-agent Systems: Economic Paradigms, Auctions and Market-Based Systems
Agent-based and Multi-agent Systems: Algorithmic Game Theory
Agent-based and Multi-agent Systems: Mechanism Design