Budget - Constrained
نویسندگان
چکیده
We study optimal procurement mechanisms for a financially constrained buyer subject to ex post incentive compatibility and individual rationality. In our setup, a buyer who has a fixed budget wishes to purchase a homogeneous product up to a maximum demand amount. We characterize the optimal mechanism when the budget constraint always binds and when the maximum demand constraint always binds. When either constraint can bind, we characterize the optimal mechanism for the case of two suppliers under regularity assumptions on the cost distribution. We also show that these optimal mechanisms have straightforward dynamic implementations.
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