Instruct: Identify the main and secondary category of Arxiv papers based on the titles and abstracts
Query: Capacity as a Fundamental Metric for Mechanism Design in the Information
  Economy   The auction theory literature has so far focused mostly on the design of
mechanisms that takes the revenue or the efficiency as a yardstick. However,
scenarios where the {\it capacity}, which we define as \textit{``the number of
bidders the auctioneer wants to have a positive probability of getting the
item''}, is a fundamental concern are ubiquitous in the information economy.
For instance, in sponsored search auctions (SSA's) or in online ad-exchanges,
the true value of an ad-slot for an advertiser is inherently derived from the
conversion-rate, which in turn depends on whether the advertiser actually
obtained the ad-slot or not; thus, unless the capacity of the underlying
auction is large, key parameters, such as true valuations and
advertiser-specific conversion rates, will remain unknown or uncertain leading
to inherent inefficiencies in the system. In general, the same holds true for
all information goods/digital goods. We initiate a study of mechanisms, which
take capacity as a yardstick, in addition to revenue/efficiency. We show that
in the case of a single indivisible item one simple way to incorporate capacity
constraints is via designing mechanisms to sell probability distributions, and
that under certain conditions, such optimal probability distributions could be
identified using a Linear programming approach. We define a quantity called
{\it price of capacity} to capture the tradeoff between capacity and
revenue/efficiency. We also study the case of sponsored search auctions.
Finally, we discuss how general such an approach via probability spikes can be
made, and potential directions for future investigations.

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The categories of this paper are: hep-ph
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The categories of this paper are: nucl-th
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The categories of this paper are: hep-ex
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The categories of this paper are: gr-qc
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The categories of this paper are: q-bio
30
The categories of this paper are: q-alg
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The categories of this paper are: cmp-lg
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The categories of this paper are: dg-ga
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The categories of this paper are: chao-dyn
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The categories of this paper are: solv-int
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The categories of this paper are: acc-phys
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The categories of this paper are: plasm-ph
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The categories of this paper are: econ
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The categories of this paper are: physics
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The categories of this paper are: q-fin
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The categories of this paper are: quant-ph