8

Notice that an agent that observes ${p}_{t}$ discovers a price that has already been decreased by $\mathrm{\Delta }$. In general, and consistent with the actual implementation of the mechanism (see the figures reported in footnote 1), we have in mind situations in which both $c$ and $\mathrm{\Delta }$ are “small”. We stress from the outset that the condition $\mathrm{\Delta } plays an important role in determining the equilibria of the game and the profitability of the mechanism. We will discuss in Section 4 the alternative assumption (which is never implemented in reality) $\mathrm{\Delta }\ge c$.