This essay provides an introduction to our recent work on robust mechanism design. The objective is to provide an overview of the research agenda and its results. We present the main results and illustrate many of them in terms of a common and canonical example, the single unit auction with...

The mechanism design literature assumes too much common knowledge of the environment among the players and planner. We relax this assumption by studying implementation on richer type spaces, with more higher order uncertainty. We study the "ex post equivalence" question: When is interim...

We say that a social choice rule is implementable with (small) transfers if one can design a mechanism whose set of equilibrium outcomes coincides with that specified by the rule but the mechanism allows for (small) ex post transfers among the players. We then show in private-value environments...

A number of studies, most notably Cr?mer and McLean (1985, 1988), have shown that in Harsanyi type spaces of a fixed finite size, it is generically possible to design mechanisms that extract all the surplus from players, and as a consequence, implement any outcome as if the players’ private...

Neeman (2004) and Heifetz and Neeman (2006) have shown that, in auctions with incomplete information about payoffs, full surplus extraction is only possible if agents’ beliefs about other agents are fully informative about their own payoff parameters. They argue that the set of...

We describe a candid model for learning, why and how learning transpires. We investigate the original as well as the leading conditions of the learning process. We provide an insight into the realm of beliefs and their formation, their interaction and influence with the actor’s environment. In...

We analyze the tax evasion problem with social interaction among the taxpayers. If the authority commits to a fixed auditing probability, a positive share of cheating is obtained in equilibrium. This stands in contrast to the existing literature, which yields full compliance of audited taxpayers...

Psychological evidence suggests that people’s learning behavior is often prone to a “myside bias†or “irrational belief persistence†in contrast to learning behavior exclusively based on objective data. In the context of Bayesian learning such a bias may result in...

This paper examines an equilibrium model of social memory -- a society's vicarious beliefs about its past. We show that incorrect social memory is a key ingredient in creating and perpetuating destructive conflicts. We analyze an infinite-horizon model in which two countries face off each period...

Examples of repeated destructive behavior abound throughout the history of human societies. This paper examines the role of social memory --- a society's vicarious beliefs about the past --- in creating and perpetuating destructive conflicts. We examine whether such behavior is consistent with...