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Often preferences are such that any sensible goal must admit a tie between all alternatives. The standard formulation in mechanism design stipulates that in this case all alternatives must be equilibrium outcomes of the decision making mechanism. However, as far as the idea of an equilibrium is...
Persistent link: https://www.econbiz.de/10012969342
Can mechanism design save democracy? We propose a simple design that offers a chance: individuals pay for as many votes as they wish using a number of "voice credits" quadratic in the votes they buy. Only quadratic cost induces marginal costs linear in votes purchased and thus welfare optimality...
Persistent link: https://www.econbiz.de/10012975457
This study demonstrates a novel epistemological approach to mechanism design. We consider a type space in which agents are either selfish or honest, and show that a slight possibility of honesty in higher-order beliefs motivates all selfish agents to behave sincerely. Specifically, in our model,...
Persistent link: https://www.econbiz.de/10013241577
We generalize the canonical problem of Nash implementation by allowing agents to voluntarily provide discriminatory signals, i.e. evidence. Evidence can either take the form of hard information or, more generally, have differential but non-prohibitive costs in different states. In such...
Persistent link: https://www.econbiz.de/10011690726
A jury has to decide the winner of a competition among a group of contestants. All members of the jury know who the deserving winner is, but this contestant is unknown to the planner. The social optimum is that the jury select the deserving winner. Each individual juror may be biased in favor...
Persistent link: https://www.econbiz.de/10011276114
For groups that must make several decisions of similar form, we define a simple and general mechanism that is designed to promote social efficiency. The mechanism links the various decisions by forcing agents to budget their representations of preferences so that the frequency of preferences...
Persistent link: https://www.econbiz.de/10005077065
Every agent reports his willingness to pay for one unit of good. A mechanism allocates goods and cost shares to some agents. We characterize the group strategyproof (GSP) mechanisms under two alternative continuity conditions interpreted as tie-breaking rules. With the maximalist rule (MAX) an...
Persistent link: https://www.econbiz.de/10009493708
In the field of mechanism design, the revelation principle has been known for decades. Myerson, Mas-Colell, Whinston and Green gave formal proofs of the revelation principle. However, in this paper, we argue that there are serious bugs hidden in their proofs.
Persistent link: https://www.econbiz.de/10008531910
We characterize the outcomes of games when players may make binding offers of strategy contingent side payments before the game is played. This does not always lead to efficient outcomes, despite complete information and costless contracting. The characterizations are illustrated in a series of...
Persistent link: https://www.econbiz.de/10005134969
We analyze the problem of choosing the w contestants who will win a competition within a group of nw competitors when all jurors commonly observe who are the w best contestants but may be biased. We study conditions on the configuration of the jury so that it is possible to induce the jurors to...
Persistent link: https://www.econbiz.de/10004997395