Decongestion by Representation: Learning to Improve Economic Welfare in Marketplaces

arXiv:2306.10606v2 Announce Type: replace
Abstract: Congestion is a common failure mode of markets, where consumers compete inefficiently on the same subset of goods (e.g., chasing the same small set of properties on a vacation rental platform). The typical economic story is that prices decongest by balancing supply and demand. But in modern online marketplaces, prices are typically set in a decentralized way by sellers, and the information about items is inevitably partial. The power of a platform is limited to …

abstract arxiv congestion consumers cs.gt cs.lg demand economic failure marketplaces markets platform rental representation set small story type vacation welfare