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Mechanism Design with Partially Verifiable Information

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  • Strausz, Roland

    (Humboldt University Berlin)

Abstract

In mechanism design with (partially) verifiable information, the revelation principle holds if allocations are modelled as the Cartesian product of outcomes and verifiable information, giving rise to evidence-contingent mechanisms. Consequently, incentive constraints characterize the implementable set. The revelation principle does not hold when an allocation is modelled as only an outcome so that mechanisms are non-contingent. Yet, any outcome implementable by an evidence-contingent mechanism is implementable by a non-contingent mechanism, provided it can both extend and restrict reporting information. A type-independent bad outcome implies the latter property.

Suggested Citation

  • Strausz, Roland, 2017. "Mechanism Design with Partially Verifiable Information," Rationality and Competition Discussion Paper Series 45, CRC TRR 190 Rationality and Competition.
    • Handle: RePEc:rco:dpaper:45
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    File URL: https://rationality-and-competition.de/wp-content/uploads/discussion_paper/45.pdf
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    References listed on IDEAS

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    1. repec:hal:spmain:info:hdl:2441/4kpa2fek478tla1o86g6n9jb6v is not listed on IDEAS
    2. Sergiu Hart & Ilan Kremer & Motty Perry, 2017. "Evidence Games: Truth and Commitment," American Economic Review, American Economic Association, vol. 107(3), pages 690-713, March.
    3. Jeanne Hagenbach & Frédéric Koessler & Eduardo Perez‐Richet, 2014. "Certifiable Pre‐Play Communication: Full Disclosure," Econometrica, Econometric Society, vol. 82(3), pages 1093-1131, May.
    4. Lipman Barton L. & Seppi Duane J., 1995. "Robust Inference in Communication Games with Partial Provability," Journal of Economic Theory, Elsevier, vol. 66(2), pages 370-405, August.
    5. , & ,, 2012. "Implementation with evidence," Theoretical Economics, Econometric Society, vol. 7(2), May.
    6. Bull, Jesse & Watson, Joel, 2004. "Evidence disclosure and verifiability," Journal of Economic Theory, Elsevier, vol. 118(1), pages 1-31, September.
    7. Bull, Jesse & Watson, Joel, 2007. "Hard evidence and mechanism design," Games and Economic Behavior, Elsevier, vol. 58(1), pages 75-93, January.
    8. Postlewaite, Andrew & Schmeidler, David, 1986. "Implementation in differential information economies," Journal of Economic Theory, Elsevier, vol. 39(1), pages 14-33, June.
    9. Bull Jesse, 2008. "Mechanism Design with Moderate Evidence Cost," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 8(1), pages 1-20, May.
    10. Ben-Porath, Elchanan & Lipman, Barton L., 2012. "Implementation with partial provability," Journal of Economic Theory, Elsevier, vol. 147(5), pages 1689-1724.
    11. ,, 2014. "Persuasion and dynamic communication," Theoretical Economics, Econometric Society, vol. 9(1), January.
    12. , & ,, 2006. "A study in the pragmatics of persuasion: a game theoretical approach," Theoretical Economics, Econometric Society, vol. 1(4), pages 395-410, December.
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    Cited by:

    1. Francisco Silva, 2020. "Self-evaluations," Documentos de Trabajo 554, Instituto de Economia. Pontificia Universidad Católica de Chile..

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    More about this item

    Keywords

    revelation principle; mechanism design; verifiable information;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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