Privacy and trust affect our strategic thinking, yet have not been precisely modeled in mechanism design. In settings of incomplete information, traditional implementations of a normal-form mechanism--by disregarding the players' privacy, or assuming trust in a mediator--may fail to reach the mechanism's objectives. We thus investigate implementations of a new type. We put forward the notion of a perfect implementation of a normal-form mechanism : in essence, a concrete extensive-form mechanism exactly preserving all strategic properties of , without relying on trusted mediators or violating the players' privacy. We prove that any normal-form mechanism can be perfectly implemented by a verifiable mediator using envelopes and an envelope-randomizing device. Differently from a trusted mediator, a verifiable one only performs prescribed public actions, so that everyone can verify that he is acting properly, and that he never learns any information that should remain private.
If 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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
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.:
- Maskin, Eric & Sjostrom, Tomas, 2001.
5-01-1, Pennsylvania State University, Department of Economics.
- F. Forges, 2010.
"An Approach to Communication Equilibrium,"
Levine's Working Paper Archive
516, David K. Levine.
- Forges, F., 1984. "An approach to communication equilibria," CORE Discussion Papers 1984035, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- FORGES, Françoise, . "An approach to communication equilibria," CORE Discussion Papers RP -721, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Patrick Bolton & Mathias Dewatripont, 2005.
MIT Press Books,
The MIT Press,
edition 1, volume 1, number 0262025760, June.
- Robert J. Aumann & Sergiu Hart, 2002.
"Long Cheap Talk,"
Discussion Paper Series
dp284, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem, revised Nov 2002.
- Gerardi, Dino, 2004.
"Unmediated communication in games with complete and incomplete information,"
Journal of Economic Theory,
Elsevier, vol. 114(1), pages 104-131, January.
- Dino Gerardi, 2002. "Unmediated Communication in Games with Complete and Incomplete Information," Cowles Foundation Discussion Papers 1371, Cowles Foundation for Research in Economics, Yale University.
- Gerardi, Dino & Myerson, Roger B., 2007.
"Sequential equilibria in Bayesian games with communication,"
Games and Economic Behavior,
Elsevier, vol. 60(1), pages 104-134, July.
- Dino Gerardi & Roger B. Myerson, 2005. "Sequential Equilibria in Bayesian Games with Communication," Cowles Foundation Discussion Papers 1542, Cowles Foundation for Research in Economics, Yale University.
- Forges, Francoise, 1990.
Econometric Society, vol. 58(6), pages 1341-64, November.
- FORGES, Françoise, . "Universal mechanisms," CORE Discussion Papers RP -914, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Forges, F., 1987. "Universal mechanisms," CORE Discussion Papers 1987004, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Ben-Porath, Elchanan, 2003. "Cheap talk in games with incomplete information," Journal of Economic Theory, Elsevier, vol. 108(1), pages 45-71, January.
- Amparo Urbano & Jose E. Vila, 2002. "Computational Complexity and Communication: Coordination in Two-Player Games," Econometrica, Econometric Society, vol. 70(5), pages 1893-1927, September.
- Vijay Krishna, R., 2007. "Communication in games of incomplete information: Two players," Journal of Economic Theory, Elsevier, vol. 132(1), pages 584-592, January.
- Ben-Porath, Elchanan, 1998. "Correlation without Mediation: Expanding the Set of Equilibrium Outcomes by "Cheap" Pre-play Procedures," Journal of Economic Theory, Elsevier, vol. 80(1), pages 108-122, May.
- Rothkopf, Michael H & Teisberg, Thomas J & Kahn, Edward P, 1990. "Why Are Vickrey Auctions Rare?," Journal of Political Economy, University of Chicago Press, vol. 98(1), pages 94-109, February.
When requesting a correction, please mention this item's handle: RePEc:eee:gamebe:v:71:y:2011:i:1:p:121-140. See general 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: (Zhang, Lei)
If references are entirely missing, you can add them using this form.