On Sharing the Benefits of Communication
AbstractWe put forward a model of private goods with externalities. Agents derive benefit from communicating with each other. In order to communicate they need to have a language in common. Learning languages is costly. In this setting no individually rational and feasible Groves mechanism exists. We characterize the best-in-class feasible Groves mechanism and the best-in-class individually rational Groves mechanism.
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Bibliographic InfoPaper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2012.41.
Date of creation: May 2012
Date of revision:
Groves Mechanisms; Externality; Budget Surplus or Deficit; Pareto Undominated Mechanisms;
Find related papers by JEL classification:
- D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- C60 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-07-14 (All new papers)
- NEP-CTA-2012-07-14 (Contract Theory & Applications)
- NEP-GTH-2012-07-14 (Game Theory)
- NEP-MIC-2012-07-14 (Microeconomics)
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