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Strategy-proofness and efficiency with non-quasi-linear preferences: a characterization of minimum price Walrasian rule

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Author Info

  • Serizawa, Shigehiro

    ()
    (Institute of Social and Economic Research, Osaka University)

  • Morimoto, Shuhei

    ()
    (JSPS Research Fellow/Graduate School of Economics, Kobe University)

Abstract

We consider the problem of allocating objects to a group of agents and how much agents should pay. Each agent receives at most one object and has non-quasi-linear preferences. Non-quasi-linear preferences describe environments where payments influence agents' abilities to utilize objects or derive benefits from them. The ``minimum price Walrasian (MPW) rule'' is the rule that assigns a minimum price Walrasian equilibrium allocation to each preference profile. We establish that the MPW rule is the unique rule satisfying \textit{strategy-proofness}, \textit{efficiency}, \textit{individual rationality}, and \textit{no subsidy for losers}. Since the outcome of the MPW rule coincides with that of the simultaneous ascending (SA) auction, our result supports SA auctions adopted by many governments.

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Bibliographic Info

Article provided by Econometric Society in its journal Theoretical Economics.

Volume (Year): (Forthcoming)
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Handle: RePEc:the:publsh:1470

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Related research

Keywords: Minimum price Walrasian equilibrium; simultaneous ascending auction; strategy-proofness; efficiency; heterogeneous objects; non-quasi-linear preferences;

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  1. Salvador Barbera & Matthew O. Jackson, 1993. "Strategy-Proof Exchange," Discussion Papers 1021, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  2. Sven de Vries & James Schummer, 2005. "On Ascending Vickrey Auctions for Heterogeneous Objects," 2005 Meeting Papers 389, Society for Economic Dynamics.
  3. Soo Chew & Shigehiro Serizawa, 2007. "Characterizing the Vickrey combinatorial auction by induction," Economic Theory, Springer, vol. 33(2), pages 393-406, November.
  4. Alcalde, Jose & Barbera, Salvador, 1994. "Top Dominance and the Possibility of Strategy-Proof Stable Solutions to Matching Problems," Economic Theory, Springer, vol. 4(3), pages 417-35, May.
  5. Lawrence M. Ausubel & Paul Milgrom, 2002. "Ascending Auctions with Package Bidding," Working Papers 02004, Stanford University, Department of Economics.
  6. Tadenuma, Koichi & Thomson, William, 1991. "No-Envy and Consistency in Economies with Indivisible Goods," Econometrica, Econometric Society, vol. 59(6), pages 1755-67, November.
  7. Demange, Gabrielle & Gale, David & Sotomayor, Marilda, 1986. "Multi-Item Auctions," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 863-72, August.
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Cited by:
  1. Andersson, Tommy & Ehlers, Lars & Svensson, Lars-Gunnar, 2014. "Transferring Ownership of Public Housing to Existing Tenants: A Mechanism Design Approach," Working Papers 2014:23, Lund University, Department of Economics.
  2. Toyotaka Sakai, 2013. "An equity characterization of second price auctions when preferences may not be quasilinear," Review of Economic Design, Springer, vol. 17(1), pages 17-26, March.

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