# Optimal Dynamic Mechanism Design with Stochastic Supply and Flexible Consumers

arXiv: https://arxiv.org/abs/2007.03007 · HTML: https://mlsanity.com/paper/2007.03007/

## Key facts

- Cited by 1 papers in the map (data through 14 Oct 2026).
- First posted on arXiv 6 Jul 2020.

## Built on by (most cited first, 1 of 1)

- [Striking a Balance: An Optimal Mechanism Design for Heterogenous Differentially Private Data Acquisition for Logistic Regression](https://mlsanity.com/paper/2309.10340/) (2023)

## Abstract (arXiv)

We consider the problem of designing an expected-revenue maximizing mechanism for allocating multiple non-perishable goods of k varieties to flexible consumers over T time steps. In our model, a random number of goods of each variety may become available to the seller at each time and a random number of consumers may enter the market at each time. Each consumer is present in the market for one time step and wants to consume one good of one of its desired varieties. Each consumer is associated with a flexibility level that indicates the varieties of the goods it is equally interested in. A consumer's flexibility level and the utility it gets from consuming a good of its desired varieties are its private information. We characterize the allocation rule for a Bayesian incentive compatible, individually rational and expected revenue maximizing mechanism in terms of the solution to a dynamic program. The corresponding payment function is also specified in terms of the optimal allocation function. We leverage the structure of the consumers' flexibility model to simplify the dynamic program and provide an alternative description of the optimal mechanism in terms of thresholds computed by the dynamic program.