2 research outputs found
Mobile Social Services with Network Externality: From Separate Pricing to Bundled Pricing
Today, many wireless device providers choose to sell devices bundled with
complementary mobile social services, which exhibit strong positive network
externality. This paper aims to quantify the benefits of selling devices and
complementary services under the following three strategies: separate pricing,
bundled pricing, and hybrid pricing (both the separate and bundled options are
offered). A comprehensive comparison of the above three strategies is carried
out for two popular service models, namely physical connectivity sharing and
virtual content sharing, respectively. We first study the physical service
model where the provider (e.g., FON) offers users customized WiFi devices for
indoor Internet access, and allows service subscribers to physically access all
device owners' WiFi when traveling. Observing that all device-owners contribute
to the connectivity sharing, we show, via a Stackelberg game theoretic
approach, that bundled pricing outperforms separate pricing as long as the
total cost of device and service is reasonably low to stimulate network
externality. Further, hybrid pricing strictly dominates bundled pricing thanks
to the pricing flexibility to keep high marginal profit of device-selling.
Next, we investigate the virtual sharing service model where the provider
(e.g., Apple) sells devices and device-supported applications. Different from
the connectivity service model, in this model service subscribers directly
contribute to the virtual content sharing, and the network externality can be
fairly strong. We prove that hybrid pricing degenerates to bundled pricing if
the network externality degree is larger than the average device valuation,
which is in stark contrast with the connectivity service model in which hybrid
pricing always outperforms bundled pricing
Fair Division of Indivisible Goods Among Strategic Agents
We study fair division of indivisible goods in a single-parameter
environment. In particular, we develop truthful social welfare maximizing
mechanisms for fairly allocating indivisible goods. Our fairness guarantees are
in terms of solution concepts which are tailored to address allocation of
indivisible goods and, hence, provide an appropriate framework for fair
division of goods. This work specifically considers fairness in terms of envy
freeness up to one good (EF1), maximin share guarantee (MMS), and Nash social
welfare (NSW).
Our first result shows that (in a single-parameter environment) the problem
of maximizing welfare, subject to the constraint that the allocation of the
indivisible goods is EF1, admits a polynomial-time, 1/2-approximate, truthful
auction. We further prove that this problem is NP-Hard and, hence, an
approximation is warranted. This hardness result also complements prior works
which show that an arbitrary EF1 allocation can be computed efficiently.
We also establish a bi-criteria approximation guarantee for the problem of
maximizing social welfare under MMS constraints. In particular, we develop a
truthful auction which efficiently finds an allocation wherein each agent gets
a bundle of value at least times her maximin
share and the welfare of the computed allocation is at least the optimal, here
is a fixed constant. We complement this result by showing that
maximizing welfare is computationally hard even if one aims to only satisfy the
MMS constraint approximately