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Two-agent interactive implementation

Author

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  • Shuichi Tsugawa

    (Okinawa University)

Abstract

This study investigates the implementation of social choice rules (SCRs) in a situation where a planner not only designs the mechanism, but also participates as a player. This type of implementation is called interactive implementation. Using the same setting as Baliga and Sjöström (Games Econ Behav 27(1):38–63, 1999) with the exception of the number of agents, I characterize the necessary and sufficient conditions for two-agent interactive implementation, and find a necessary and sufficient condition, which we term intersection property. Even though our example shows the benefits of two-agent interactive implementation, that is, interactive implementation makes it possible to implement a non Maskin monotonic SCR, we find that it is not possible to implement a utilitarian planner’s optimum in a two-agent exchange economy and to resolve King Solomon’s dilemma.

Suggested Citation

  • Shuichi Tsugawa, 2021. "Two-agent interactive implementation," Review of Economic Design, Springer;Society for Economic Design, vol. 25(4), pages 251-266, December.
    • Handle: RePEc:spr:reecde:v:25:y:2021:i:4:d:10.1007_s10058-021-00247-6
    DOI: 10.1007/s10058-021-00247-6
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    References listed on IDEAS

    as
    1. Eric Maskin, 1999. "Nash Equilibrium and Welfare Optimality," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 66(1), pages 23-38.
    2. Baliga, Sandeep & Sjostrom, Tomas, 1999. "Interactive Implementation," Games and Economic Behavior, Elsevier, vol. 27(1), pages 38-63, April.
    3. Baliga, Sandeep & Corchon, Luis C. & Sjostrom, Tomas, 1997. "The Theory of Implementation When the Planner Is a Player," Journal of Economic Theory, Elsevier, vol. 77(1), pages 15-33, November.
    4. Jackson, Matthew O, 1991. "Bayesian Implementation," Econometrica, Econometric Society, vol. 59(2), pages 461-477, March.
    5. Liu, Changchen & Luo, Yunfeng & Zeng, Nvpo, 2010. "Voluntary implementation when the planner is a player," Economics Letters, Elsevier, vol. 108(2), pages 201-204, August.
    6. Liu, Changchen & Luo, Yunfeng, 2010. "Perfect Bayesian implementation when the planner is a player," Journal of Mathematical Economics, Elsevier, vol. 46(4), pages 400-404, July.
    7. Francesca Busetto & Giulio Codognato, 2009. "Reconsidering two-agent Nash implementation," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 32(2), pages 171-179, February.
    8. Moore, John & Repullo, Rafael, 1990. "Nash Implementation: A Full Characterization," Econometrica, Econometric Society, vol. 58(5), pages 1083-1099, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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