Optimal Contracting Of New Experience Goods

  title={Optimal Contracting Of New Experience Goods},
  author={Rahul Deb},
We model new experience goods in the context of dynamic mechanism design. These are goods for which an agent is unsure of her valuation but can learn it through consumption experience. We consider a dynamic environment with a single buyer and seller in which contracting occurs over T periods, where each time the agent consumes the object, she receives a signal which allows her to revise her valuation. In this setting, experimentation with the product is strategic both for the buyer and seller… CONTINUE READING

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