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Mechanism Design with Weaker Incentive Compatibility Constraints

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  • Celik, Gorkem

Abstract

We study an adverse selection problem, where an agent is able to understate his productivity, but not allowed to overstate it. The solution to this problem is generally different than the solution to the standard problem, where no restriction is made on the statements of the agent. We identify a sufficient condition, that does not depend on the distribution of types, under which these two solutions coincide.

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Bibliographic Info

Paper provided by Vancouver School of Economics in its series Microeconomics.ca working papers with number celik-04-09-13-05-50-40.

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Length: 0 pages
Date of creation: 13 Sep 2004
Date of revision: 06 Aug 2008
Handle: RePEc:ubc:pmicro:celik-04-09-13-05-50-40

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Web page: http://www.economics.ubc.ca/

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Keywords: Mechanism Design; Incentive Compatibility;

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  1. Green, Jerry R & Laffont, Jean-Jacques, 1986. "Partially Verifiable Information and Mechanism Design," Review of Economic Studies, Wiley Blackwell, vol. 53(3), pages 447-56, July.
  2. Moore, John, 1988. "Contracting between Two Parties with Private Information," Review of Economic Studies, Wiley Blackwell, vol. 55(1), pages 49-69, January.
  3. Deneckere,R. & Severinov,S., 2001. "Mechanism design and communication costs," Working papers 23, Wisconsin Madison - Social Systems.
  4. Steven Matthews & John Moore, 1985. "Monopoly Provision of Quality and Warranties: An Exploration in the Theory of Multidimensional Screening," Discussion Papers 661, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  5. Lu Hong & Scott Page, 1994. "Reducing informational costs in endowment mechanisms," Review of Economic Design, Springer, vol. 1(1), pages 103-117, December.
  6. Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, December.
  7. Giovanni Maggi & Andres Rodriguez-Clare, 1995. "Costly Distortion of Information in Agency Problems," RAND Journal of Economics, The RAND Corporation, vol. 26(4), pages 675-689, Winter.
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Cited by:
  1. Sher, Itai & Vohra, Rakesh, 0. "Price discrimination through communication," Theoretical Economics, Econometric Society.

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