Designing Pandora’s Box: Product Rankings and Marketplace Participation
24 Feb 2025
11:00 -12:45
Times are shown in local time.
Open to: All
Castle Teaching Room (Cambridge Judge Business School)
Trumpington St
Cambridge
CB2 1AG
United Kingdom
Join our Operations and Technology Management seminar
Speaker: Dr Yiangos Papanastasiou, Jones Graduate School of Business at Rice University
About the seminar topic
With the rapid growth of e-commerce, product rankings have emerged as a primary lever used by 2-sided platforms to match supply and demand. Although product rankings have been studied from a variety of perspectives, existing research typically overlooks the interaction between ranking policies and seller behaviour.
In this paper, we present a model in which both sides of the market respond strategically to the platform’s ranking policy: on the supply side, sellers participate only if their earnings exceed the outside option, while on the demand side, consumers adjust their search behaviour to maximise their utility.
We illustrate that in such settings, greedy policies that simply direct consumers to the sellers that best match their preferences are often suboptimal due to poor marketplace participation. To reduce this inefficiency, we develop a new optimisation framework and propose an approach for designing randomised ranking policies which are scalable, incentive-compatible, and near-optimal in many practically relevant cases.
Speaker bio
Yiangos Papanastasiou is an Associate Professor of Operations Management at the Jones Graduate School of Business at Rice University.
His research focuses primarily on the operations of online platforms and marketplaces, where his work has contributed to our understanding of optimal information disclosure, social learning and the economics of misinformation. Before joining Rice University, he was an Associate Professor at UC Berkeley’s Haas School of Business.
He holds a PhD in Management Science from London Business School, and a BA and MEng in Computer Engineering from the University of Cambridge.
Register
No registration required. If you have any questions about this seminar, please email Khanti Tsui.