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Strategy-proofness and essentially single-valued cores revisited

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  • Ehlers, Lars

Abstract

We consider general allocation problems with indivisibilities where agents' preferences possibly exhibit externalities. In such contexts many different core notions were proposed. One is the individually-rational-core (IR-core) whereby blocking is only allowed via allocations where the non-blocking agents receive their endowments. We show that if there exists an allocation rule satisfying individual rationality, efficiency, and strategy-proofness, then for any problem for which the IR-core is non-empty, the allocation rule must choose an IR-core allocation and all agents are indifferent between all allocations in the IR-core. We further show that the result cannot be generalized to supersets of the IR-core. We apply our result to housing markets, coalition formation and networks.

Suggested Citation

  • Ehlers, Lars, 2018. "Strategy-proofness and essentially single-valued cores revisited," Journal of Economic Theory, Elsevier, vol. 176(C), pages 393-407.
    • Handle: RePEc:eee:jetheo:v:176:y:2018:i:c:p:393-407
    DOI: 10.1016/j.jet.2018.04.008
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    Cited by:

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    3. Maria Gabriella Graziano & Claudia Meo & Nicholas C. Yannelis, 2018. "Housing market models with consumption externalities," CSEF Working Papers 500, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    4. Maria Gabriella Graziano & Claudia Meo & Nicholas C. Yannelis, 2020. "Shapley and Scarf housing markets with consumption externalities," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 22(5), pages 1481-1514, September.
    5. María Haydée Fonseca‐Mairena & Matteo Triossi, 2023. "Notes on marriage markets with weak externalities," Bulletin of Economic Research, Wiley Blackwell, vol. 75(4), pages 860-868, October.
    6. Zhang, Jun, 2023. "Strategy-proof allocation with outside option," Games and Economic Behavior, Elsevier, vol. 137(C), pages 50-67.

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    More about this item

    Keywords

    General allocation problems; Externalities; Strategy-proofness; IR-core;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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