## Abstract

Walrasian prices, if they exist, have the property that one can assign every buyer some bundle in her demand set, such that the resulting assignment will maximize social welfare. Unfortunately, this assumes carefully breaking ties amongst different bundles in the buyer demand set. Presumably, the shopkeeper cleverly convinces the buyer to break ties in a manner consistent with maximizing social welfare. Lacking such a shopkeeper, if buyers arrive sequentially and simply choose some arbitrary bundle in their demand set, the social welfare may be arbitrarily bad. In the context of matching markets, we show how to compute dynamic prices, based upon the current inventory, that guarantee that social welfare is maximized. Such prices are set without knowing the identity of the next buyer to arrive. We also show that this is impossible in general (e.g., for coverage valuations), but consider other scenarios where this can be done. We further extend our results to Bayesian and bounded rationality models.

Original language | English |
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Title of host publication | EC 2016 - Proceedings of the 2016 ACM Conference on Economics and Computation |

Publisher | Association for Computing Machinery, Inc |

Pages | 383-400 |

Number of pages | 18 |

ISBN (Electronic) | 9781450339360 |

DOIs | |

State | Published - 21 Jul 2016 |

Externally published | Yes |

Event | 17th ACM Conference on Economics and Computation, EC 2016 - Maastricht, Netherlands Duration: 24 Jul 2016 → 28 Jul 2016 |

### Publication series

Name | EC 2016 - Proceedings of the 2016 ACM Conference on Economics and Computation |
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### Conference

Conference | 17th ACM Conference on Economics and Computation, EC 2016 |
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Country/Territory | Netherlands |

City | Maastricht |

Period | 24/07/16 → 28/07/16 |

### Bibliographical note

Publisher Copyright:© Copyright 2016 ACM.