AbstractWe consider the allocation of goods in exchange economies with a finite number of agents who may have private information about their preferences. In such a setting, standard allocation rules such as Walrasian equilibria or rational expectations equilibria are not compatible with individual incentives. We characterize the set of allocations rules which are incentive compatible, or in other words, the set of strategy-proof social choice functions. The social choice functions which are strategy-proof are those which can be obtained from trading according to pre-specified proportions. The number of proportions which can be accommodated is proportional to the number of agents. Such rules are necessarily inefficient, even in the limit as the economy grows.
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 Northwestern University, Center for Mathematical Studies in Economics and Management Science in its series Discussion Papers with number 1021.
Date of creation: Jan 1993
Date of revision:
Contact details of provider:
Postal: Center for Mathematical Studies in Economics and Management Science, Northwestern University, 580 Jacobs Center, 2001 Sheridan Road, Evanston, IL 60208-2014
Web page: http://www.kellogg.northwestern.edu/research/math/
More information through EDIRC
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.:
- Mas-Colell, Andreu & Vives, Xavier, 1993.
"Implementation in Economies with a Continuum of Agents,"
Review of Economic Studies,
Wiley Blackwell, vol. 60(3), pages 613-29, July.
- Vives, X. & Mas-Colell, A., 1989. "Implementation in economies with a Continuum of Agents," UFAE and IAE Working Papers 129.90, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Dasgupta, Partha S & Hammond, Peter J & Maskin, Eric S, 1979. "The Implementation of Social Choice Rules: Some General Results on Incentive Compatibility," Review of Economic Studies, Wiley Blackwell, vol. 46(2), pages 185-216, April.
- repec:hoo:wpaper:e-91-2 is not listed on IDEAS
- Postlewaite, Andrew & Schmeidler, David, 1986. "Implementation in differential information economies," Journal of Economic Theory, Elsevier, vol. 39(1), pages 14-33, June.
- Blume, Lawrence & Easley, David, 1990. "Implementation of Walrasian expectations equilibria," Journal of Economic Theory, Elsevier, vol. 51(1), pages 207-227, June.
- Roberts, Donald John & Postlewaite, Andrew, 1976. "The Incentives for Price-Taking Behavior in Large Exchange Economies," Econometrica, Econometric Society, vol. 44(1), pages 115-27, January.
- Salvador Barbera & Matthew Jackson, 1991. "A Characterization of Strategy-Proof Social Choice Functions for Economies with Pure Public Goods," Discussion Papers 964, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Abreu, Dilip & Matsushima, Hitoshi, 1992. "Virtual Implementation in Iteratively Undominated Strategies: Complete Information," Econometrica, Econometric Society, vol. 60(5), pages 993-1008, September.
- repec:hoo:wpaper:e-91-1 is not listed on IDEAS
- repec:fth:stanho:e-91-2 is not listed on IDEAS
- Satterthwaite, Mark Allen, 1975. "Strategy-proofness and Arrow's conditions: Existence and correspondence theorems for voting procedures and social welfare functions," Journal of Economic Theory, Elsevier, vol. 10(2), pages 187-217, April.
- Barbera, S. & Peleg, B., 1988. "Strategy-Proof Voting Schemes With Continuous Preferences," UFAE and IAE Working Papers 91.88, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Satterthwaite, Mark A & Sonnenschein, Hugo, 1981. "Strategy-Proof Allocation Mechanisms at Differentiable Points," Review of Economic Studies, Wiley Blackwell, vol. 48(4), pages 587-97, October.
- Hagerty, Kathleen M. & Rogerson, William P., 1987. "Robust trading mechanisms," Journal of Economic Theory, Elsevier, vol. 42(1), pages 94-107, June.
- Hurwicz, Leonid & Walker, Mark, 1990. "On the Generic Nonoptimality of Dominant-Strategy Allocation Mechanisms: A General Theorem That Includes Pure Exchange Economies," Econometrica, Econometric Society, vol. 58(3), pages 683-704, May.
- Jackson, Matthew O, 1991. "Bayesian Implementation," Econometrica, Econometric Society, vol. 59(2), pages 461-77, March.
- John Moore, 1991. "Implementation in Environments with Complete Information (Now published as 'Implementation, Contracts and Renegotiation in Environments with Complete Information' in J-J Laffont (ed.), Advances in Eco," STICERD - Theoretical Economics Paper Series /1991/235, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
- AUMANN, Robert J. & DREZE, Jacques H., .
"Values of markets with satiation or fixed prices,"
CORE Discussion Papers RP
-722, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Thomson, W., 1990. "Monotonic And Consistent Solutions To The Problem Of Fair Allocation When Preferences Are Single-Peaked," RCER Working Papers 231, University of Rochester - Center for Economic Research (RCER).
- Gibbard, Allan, 1973. "Manipulation of Voting Schemes: A General Result," Econometrica, Econometric Society, vol. 41(4), pages 587-601, July.
- Gul, Faruk & Postlewaite, Andrew, 1992. "Asymptotic Efficiency in Large Exchange Economies with Asymmetric Information," Econometrica, Econometric Society, vol. 60(6), pages 1273-92, November.
- repec:fth:stanho:e-91-1 is not listed on IDEAS
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Fran Walker).
If references are entirely missing, you can add them using this form.