No Screening is More Efficient with Multiple Objects

Abstract:We study the welfare-maximizing allocation of heterogeneous objects when screening uses costly effort rather than monetary transfers. No-screening mechanisms perform well as object variety increases. In a symmetric continuous market with i.i.d. values whose CDF is log-concave, the multidimensional problem reduces exactly to a single-dimensional problem in agents' best-option values. More options make low best-option values rarer, weakening the case for screening. We characterize when no screening is optimal and show it remains optimal as variety expands. Large-variety limits and numerical results for finite, correlated markets support this pattern. We apply these results to propose an invitation-based vaccine appointment system.

Theoretical Economics (econ.TH); Artificial Intelligence (cs.AI); Computer Science and Game Theory (cs.GT); Machine Learning (cs.LG)

arXiv:2408.10077 [econ.TH]

(or arXiv:2408.10077v4 [econ.TH] for this version)

https://doi.org/10.48550/arXiv.2408.10077 Focus to learn more arXiv-issued DOI via DataCite

arXivLabs is a framework that allows collaborators to develop and share new arXiv features directly on our website.

Both individuals and organizations that work with arXivLabs have embraced and accepted our values of openness, community, excellence, and user data privacy. arXiv is committed to these values and only works with partners that adhere to them.

Have an idea for a project that will add value for arXiv's community? Learn more about arXivLabs.