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Egalitarian Equivalence under Asymmetric Information

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Abstract

We propose a definition of egalitarian equivalence that extends Pazner and Schmeidler’s (1978) concept to environments with incomplete information. If every feasible allocation rule can be implemented by an incentive compatible mechanism (as, for instance, in the case of non-exclusive information), then interim egalitarian equivalence and interim incentive efficiency remain compatible, as they were under complete information. When incentive constraints are more restrictive, on the other hand, the two criteria may become incompatible.

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File URL: http://www.brown.edu/Departments/Economics/Papers/2010/2010-5_paper.pdf
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Bibliographic Info

Paper provided by Brown University, Department of Economics in its series Working Papers with number 2010-5.

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Date of creation: 2010
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Handle: RePEc:bro:econwp:2010-5

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Postal: Department of Economics, Brown University, Providence, RI 02912

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Keywords: Pareto Efficiency: Egalitarian Equivalence; Asymmetric Information;

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Cited by:
  1. Yuan Ju, 2013. "Efficiency and compromise: a bid-offer–counteroffer mechanism with two players," International Journal of Game Theory, Springer, vol. 42(2), pages 501-520, May.
  2. Geoffroy de Clippel, 2010. "Copmment on Egalitarianism under Incomplete Information," Working Papers 2010-4, Brown University, Department of Economics.

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