Two-sided search with experts

Yinon Nahum, David Sarne, Sanmay Das, Onn Shehory

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

7 Scopus citations


In this paper we study distributed agent matching in environments characterized by uncertain signals, costly exploration, and the presence of an information broker. Each agent receives information about the potential value of matching with others. This information signal may, however be noisy, and the agent incurs some cost in receiving it. If all candidate agents agree to the matching the team is formed and each agent receives the true unknown utility of the matching, and leaves the market. We consider the effect of the presence of information brokers, or experts, on the outcomes of such matching processes. Experts can, upon payment of a fee, perform the service of disambiguating noisy signals and revealing the true value of a match to any agent. We analyze equilibrium behavior given the fee set by a monopolist expert and use this analysis to derive the revenue maximizing strategy for the expert as the first mover in a Stackelberg game. Surprisingly, we find that better information can hurt: the presence of the expert, even if the use of its services is optional, can degrade both individual agents' utilities and overall social welfare. While in one-sided search the presence of the expert can only help, in two-sided (and general k-sided) search the externality imposed by the fact that others are consulting the expert can lead to a situation where the equilibrium outcome is that everyone consults the expert, even though all agents would be better off if the expert were not present. As an antidote, we show how market designers can enhance welfare by taxing use of expert services.

Original languageEnglish
Title of host publicationEC '12 - Proceedings of the 13th ACM Conference on Electronic Commerce
Number of pages18
StatePublished - 2012
Externally publishedYes
Event13th ACM Conference on Electronic Commerce, EC '12 - Valencia, Spain
Duration: 4 Jun 20128 Jun 2012

Publication series

NameProceedings of the ACM Conference on Electronic Commerce


Conference13th ACM Conference on Electronic Commerce, EC '12


  • distributed matching
  • information brokers


Dive into the research topics of 'Two-sided search with experts'. Together they form a unique fingerprint.

Cite this