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Honesty and Epistemological Implementation of Social Choice Functions with Asymmetric Information

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  • Hitoshi Matsushima

    (Department of Economics, University of Tokyo)

Abstract

We investigate the implementation of social choice functions with asymmetric information concerning the state from an epistemological perspective. Although agents are either selfish or honest, they do not expect other participants to be honest. However, an honest agent may exist not among participants but in their higher-order beliefs. We assume that “all agents are selfish†never happens to be common knowledge. We show a positive result in general asymmetric information environments, demonstrating that with a minor restriction on signal correlation called information diversity, any incentive-compatible social choice function, whether ethical or nonethical, is uniquely implementable in the Bayesian Nash equilibrium.

Suggested Citation

  • Hitoshi Matsushima, 2022. "Honesty and Epistemological Implementation of Social Choice Functions with Asymmetric Information," CARF F-Series CARF-F-548, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    • Handle: RePEc:cfi:fseres:cf548
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    References listed on IDEAS

    as
    1. Dutta, Bhaskar & Sen, Arunava, 2012. "Nash implementation with partially honest individuals," Games and Economic Behavior, Elsevier, vol. 74(1), pages 154-169.
    2. Matsushima, Hitoshi, 2008. "Role of honesty in full implementation," Journal of Economic Theory, Elsevier, vol. 139(1), pages 353-359, March.
    3. Matsushima, Hitoshi, 2022. "Epistemological implementation of social choice functions," Games and Economic Behavior, Elsevier, vol. 136(C), pages 389-402.
    4. Kartik, Navin & Tercieux, Olivier & Holden, Richard, 2014. "Simple mechanisms and preferences for honesty," Games and Economic Behavior, Elsevier, vol. 83(C), pages 284-290.
    5. Venkatesh Bala & Sanjeev Goyal, 2000. "A Noncooperative Model of Network Formation," Econometrica, Econometric Society, vol. 68(5), pages 1181-1230, September.
    6. Uzawa,Hirofumi, 2008. "Economic Analysis of Social Common Capital," Cambridge Books, Cambridge University Press, number 9780521066495.
    7. Hans-Peter Kohler & Jere Behrman & Susan Watkins, 2001. "The density of social networks and fertility decisions: evidence from south nyanza district, kenya," Demography, Springer;Population Association of America (PAA), vol. 38(1), pages 43-58, February.
    8. Matsushima, Hitoshi, 2008. "Behavioral aspects of implementation theory," Economics Letters, Elsevier, vol. 100(1), pages 161-164, July.
    9. Johannes Abeler & Daniele Nosenzo & Collin Raymond, 2019. "Preferences for Truth‐Telling," Econometrica, Econometric Society, vol. 87(4), pages 1115-1153, July.
    10. Ortner, Juan, 2015. "Direct implementation with minimally honest individuals," Games and Economic Behavior, Elsevier, vol. 90(C), pages 1-16.
    11. Mukherjee, Saptarshi & Muto, Nozomu & Ramaekers, Eve, 2017. "Implementation in undominated strategies with partially honest agents," Games and Economic Behavior, Elsevier, vol. 104(C), pages 613-631.
    12. Hitoshi Matsushima, 2013. "Process manipulation in unique implementation," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 41(4), pages 883-893, October.
    13. Saporiti, Alejandro, 2014. "Securely implementable social choice rules with partially honest agents," Journal of Economic Theory, Elsevier, vol. 154(C), pages 216-228.
    Full references (including those not matched with items on IDEAS)

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