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Secure Implementation

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Author Info
Tatsuyoshi Saijo () (Osaka University)
Tomas Sjostrom () (Department of Economics, Rutgers University)
Takehiko Yamato () (Department of Values and Decision Science, Tokyo Institute of Technology)

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Abstract

Strategy-proofness, requiring that truth-telling is a dominant strategy, is a standard concept in social choice theory. However, this concept has serious drawbacks. In particular, many strategy-proof mechanisms have multiple Nash equilibria, some of which produce the wrong outcome. A possible solution to this problem is to require double implementation in Nash equilibrium and in dominant strategies, i.e., secure implementation. We characterize securely implementable social choice functions, and compare our results with dominant strategy implementation. In standard quasi-linear environments with divisible private or public goods, there exist Pareto efficient (non-dictatorial) social choice functions that can be securely implemented. But in the absence of side-payments, secure implementation is incompatible with Pareto efficiency.

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Publisher Info
Paper provided by Institute for Advanced Study, School of Social Science in its series Economics Working Papers with number 0056.

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Length: 34 pages
Date of creation: Jul 2005
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Handle: RePEc:ads:wpaper:0056

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Find related papers by JEL classification:
C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy-Making and Implementation
H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Salvador Barbera & Matthew Jackson, 1991. "A Characterization of Strategy-Proof Social Choice Functions for Economies with Pure Public Goods," Discussion Papers 964, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  2. Dirk Bergemann & Stephen Morris, 2005. "Robust Implementation: The Role of Large Type Spaces," Levine's Bibliography 784828000000000116, UCLA Department of Economics. [Downloadable!]
    Other versions:
  3. Attiyeh, Greg & Franciosi, Robert & Isaac, R Mark, 2000. " Experiments with the Pivot Process for Providing Public Goods," Public Choice, Springer, vol. 102(1-2), pages 95-114, January. [Downloadable!] (restricted)
  4. Border, Kim C & Jordan, J S, 1983. "Straightforward Elections, Unanimity and Phantom Voters," Review of Economic Studies, Blackwell Publishing, vol. 50(1), pages 153-70, January. [Downloadable!] (restricted)
  5. Satterthwaite, Mark A & Sonnenschein, Hugo, 1981. "Strategy-Proof Allocation Mechanisms at Differentiable Points," Review of Economic Studies, Blackwell Publishing, vol. 48(4), pages 587-97, October. [Downloadable!] (restricted)
  6. Moulin, Herve, 1994. "Serial Cost-Sharing of Excludable Public Goods," Review of Economic Studies, Blackwell Publishing, vol. 61(2), pages 305-25, April. [Downloadable!] (restricted)
  7. Ma, Jinpeng, 1994. "Strategy-Proofness and the Strict Core in a Market with Indivisibilities," International Journal of Game Theory, Springer, vol. 23(1), pages 75-83.
  8. Kagel, John H & Harstad, Ronald M & Levin, Dan, 1987. "Information Impact and Allocation Rules in Auctions with Affiliated Private Values: A Laboratory Study," Econometrica, Econometric Society, vol. 55(6), pages 1275-1304, November. [Downloadable!] (restricted)
  9. Cason, Timothy N. & Saijo, Tatsuyoshi & Sjostrom, Tomas & Yamato, Takehiko, 2003. "Secure Implementation Experiments: Do Strategy-proof Mechanisms Really Work?," Working Papers 4-03-1, Pennsylvania State University, Department of Economics. [Downloadable!]
    Other versions:
  10. Moulin, Herve & Shenker, Scott, 1992. "Serial Cost Sharing," Econometrica, Econometric Society, vol. 60(5), pages 1009-37, September. [Downloadable!] (restricted)
  11. Dirk Bergemann & Stephen Morris, 2003. "Robust Mechanism Design," Cowles Foundation Discussion Papers 1421R, Cowles Foundation, Yale University, revised Apr 2004. [Downloadable!]
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  12. Repullo, Rafael, 1985. "Implementation in Dominant Strategies under Complete and Incomplete Information," Review of Economic Studies, Blackwell Publishing, vol. 52(2), pages 223-29, April. [Downloadable!] (restricted)
  13. Kagel, J.H. & Levin, D., 1988. "Independent Private Value Auctions: Bidder Behavior In First, Second And Third-Price Auctions With Varying Numbers Of Bidders," Papers 13, Houston - Department of Economics.
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  14. James Schummer & Rakesh V. Vohra, 1999. "Strategy-proof Location on a Network," Discussion Papers 1253, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
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  15. Roth, Alvin E. & Postlewaite, Andrew, 1977. "Weak versus strong domination in a market with indivisible goods," Journal of Mathematical Economics, Elsevier, vol. 4(2), pages 131-137, August. [Downloadable!] (restricted)
  16. Sprumont, Yves, 1991. "The Division Problem with Single-Peaked Preferences: A Characterization of the Uniform Allocation Rule," Econometrica, Econometric Society, vol. 59(2), pages 509-19, March. [Downloadable!] (restricted)
  17. Kawagoe, Toshiji & Mori, Toru, 2001. " Can the Pivotal Mechanism Induce Truth-Telling? An Experimental Study," Public Choice, Springer, vol. 108(3-4), pages 331-54, September. [Downloadable!] (restricted)
  18. Groves, Theodore, 1973. "Incentives in Teams," Econometrica, Econometric Society, vol. 41(4), pages 617-31, July. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Yuji Fujinaka & Toyotaka Sakai, 2009. "The positive consequence of strategic manipulation in indivisible good allocation," International Journal of Game Theory, Springer, vol. 38(3), pages 325-348, November. [Downloadable!] (restricted)
  2. Hideki Mizukami & Tatsuyoshi Saijo & Takuma Wakayama, 2005. "Strategy-proof Sharing," Discussion Papers in Economics and Business 05-05, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP). [Downloadable!]
    Other versions:
    • Mizukami, Hideki & Saijo, Tatsuyoshi & Wakayama, Takuma, 2003. "Strategy-Proof Sharing," Working Papers 1170, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
    • Hideki Mizukami & Tatsuyoshi Saijo & Takuma Wakayama, 2003. "Strategy-proof Sharing," Discussion papers 03017, Research Institute of Economy, Trade and Industry (RIETI). [Downloadable!]
  3. Yuji Fujinaka & Takuma Wakayama, 2008. "Secure Implementation in Shapley-Scarf Housing Markets," ISER Discussion Paper 0727, Institute of Social and Economic Research, Osaka University, revised Feb 2009. [Downloadable!]
  4. Luis C. Corchon, 2007. "The theory of implementation : what did we learn?," Economics Working Papers we081207, Universidad Carlos III, Departamento de Economía. [Downloadable!]
  5. Mathevet, Laurent, 2007. "Supermodular Bayesian implementation: Learning and incentive design," Working Papers 1265, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
  6. Dolors Berga & Bernardo Moreno, 2009. "Strategic requirements with indifference: single-peaked versus single-plateaued preferences," Social Choice and Welfare, Springer, vol. 32(2), pages 275-298, February. [Downloadable!] (restricted)
    Other versions:
  7. Das, Chhandita & Anderson, Christopher & Swallow, Stephen, 2006. "Incentive Compatible Mechanism Design for Discrete Choice Surveys," 2006 Annual meeting, July 23-26, Long Beach, CA 21327, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  8. Hideki Mizukami & Takuma Wakayama, 2004. "Dominant Strategy Implementation in Pure Exchange Economies," Discussion Papers in Economics and Business 04-03-Rev, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Mar 2005. [Downloadable!]
  9. Saijo, Tatsuyoshi & Sjostrom, Tomas & Yamato, Takehiko, 2003. "Secure Implementation: Strategy-Proof Mechanisms Reconsidered," Working Papers 9-03-1, Pennsylvania State University, Department of Economics. [Downloadable!]
    Other versions:
  10. Dirk Bergemann & Stephen Morris, 2005. "Ex Post Implementation," Cowles Foundation Discussion Papers 1502, Cowles Foundation, Yale University. [Downloadable!]
    Other versions:
  11. Yuji Fujinaka & Takuma Wakayama, 2007. "Secure Implementation in Economies with Indivisible Objects and Money," ISER Discussion Paper 0699, Institute of Social and Economic Research, Osaka University. [Downloadable!]
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