Abstract: |
We study a model of a monopolistic social platform populated by a continuum of content providers and content viewers. Providers incur convex costs to produce content quality, in return for viewers’ attention. Viewers allocate costly attention to available contents, in return for utility from reading them. Players are horizontally differentiated and also heterogeneous in the utility from attention. A mechanism is an algorithm by the platform allocating attention based on the quality of contents. In both welfare and attention maximizing mechanisms attention is sometimes allocated to irrelevant contents, giving rise to global influencers who typically care much about receiving attention. The attention maximizing mechanism encourages excessive content provision and preference mismatch compared to the welfare maximizing mechanism, reducing the utility of all providers and viewers to zero. When the providers types are unknown, the platform's ability to extract effort is greatly reduced, but this is unlikely to persist in the long run.
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Biography:
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Yi Chen is an assistant professor of economics at the Samuel Curtis Johnson Graduate School of Management. He holds a PhD in economics from Yale University, with a focus on game theory and mechanism design. Chen’s research includes both theoretical and applied approaches to principal-agent problems, dynamic games, and organizational economics.
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