Process Manipulation in Unique Implementation
AbstractWe incorporate social influence into implementation theory, and highlight the manner in which an informed agent feels guilty with regard to disobeying an uninformed principalâ€™s wishes. The degree of this feeling depends on the agentâ€™s expectation of othersâ€™ behavioral modes. We demonstrate a method of process manipulation, through which the principal employs psychological tactics for incentivizing agents to announce information in keeping with his/her wishes. We indicate that with a version of incentive compatibility, the principal can implement any alternative that he/she wishes as the unique Nash equilibrium without employing any contractual devices. Each agentâ€™s psychological cost would be negligible.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo in its series CARF F-Series with number CARF-F-301.
Length: 19 pages
Date of creation: Dec 2008
Date of revision: Jul 2012
Other versions of this item:
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.:
- Kfir Eliaz, 2002. "Fault Tolerant Implementation," Review of Economic Studies, Oxford University Press, vol. 69(3), pages 589-610.
- Maskin, Eric, 1999.
"Nash Equilibrium and Welfare Optimality,"
Review of Economic Studies,
Wiley Blackwell, vol. 66(1), pages 23-38, January.
- Eric Maskin, 1998. "Nash Equilibrium and Welfare Optimality," Harvard Institute of Economic Research Working Papers 1829, Harvard - Institute of Economic Research.
- Hitoshi Matsushima, 2007.
"Behavioral Aspects of Implementation Theory,"
CIRJE-F-523, CIRJE, Faculty of Economics, University of Tokyo.
- Lombardi Michele & Yoshihara Naoki, 2012.
"Natural implementation with partially hones agents,"
005, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
- Lombardi, Michele & Yoshihara, Naoki, 2012. "Natural Implementation with Partially Honest Agents," Discussion Paper Series 561, Institute of Economic Research, Hitotsubashi University.
- Hitoshi Matsushima, 2006.
"Role of Honesty in Full Implementation,"
CIRJE-F-405, CIRJE, Faculty of Economics, University of Tokyo.
- Martin J Osborne & Ariel Rubinstein, 2009.
"A Course in Game Theory,"
814577000000000225, UCLA Department of Economics.
- Abreu, Dilip & Matsushima, Hitoshi, 1992. "Virtual Implementation in Iteratively Undominated Strategies: Complete Information," Econometrica, Econometric Society, vol. 60(5), pages 993-1008, September.
- Kartik, Navin & Tercieux, Olivier, 2012. "Implementation with evidence," Theoretical Economics, Econometric Society, vol. 7(2), May.
- Akerlof, George A & Dickens, William T, 1982. "The Economic Consequences of Cognitive Dissonance," American Economic Review, American Economic Association, vol. 72(3), pages 307-19, June.
- Uri Gneezy, 2005. "Deception: The Role of Consequences," American Economic Review, American Economic Association, vol. 95(1), pages 384-394, March.
- Eliaz, K., 1999.
"Fault Tolerant Implementation,"
21-99, Tel Aviv.
- Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-77, October.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.