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Mechanism Design Powered by Social Interactions

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  • Dengji Zhao

Abstract

Mechanism design has traditionally assumed that the set of participants are fixed and known to the mechanism (the market owner) in advance. However, in practice, the market owner can only directly reach a small number of participants (her neighbours). Hence the owner often needs costly promotions to recruit more participants in order to get desirable outcomes such as social welfare or revenue maximization. In this paper, we propose to incentivize existing participants to invite their neighbours to attract more participants. However, they would not invite each other if they are competitors. We discuss how to utilize the conflict of interest between the participants to incentivize them to invite each other to form larger markets. We will highlight the early solutions and open the floor for discussing the fundamental open questions in the settings of auctions, coalitional games, matching and voting.

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  • Dengji Zhao, 2021. "Mechanism Design Powered by Social Interactions," Papers 2102.10347, arXiv.org.
    • Handle: RePEc:arx:papers:2102.10347
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    Cited by:

    1. Yuhang Guo & Dong Hao & Bin Li, 2022. "Combinatorial Procurement Auction in Social Networks," Papers 2208.14591, arXiv.org.
    2. Matthew Olckers & Toby Walsh, 2022. "Manipulation and Peer Mechanisms: A Survey," Papers 2210.01984, arXiv.org, revised Nov 2023.

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