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Risk-minimizing GUE-implementations of truthful reporting in a Dynamic Social Choice Problem

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  • Endre Cs'oka
  • M'at'e Viczi'an

Abstract

The Guaranteed Utility Mechanism (GUM) was introduced to implement efficiency in Guaranteed Utility Equilibrium (GUE) in dynamic social choice problems. We show that this mechanism also has a previously unknown connection to risk minimization. Fixing an efficient decision policy, we study variance-minimizing budget-balanced transfer rules in the class of GUE-implementations of truthful reporting. A symmetrized version of GUM (sym-GUM) minimizes the sum of the agents' utility variances under truthful reporting when there is no public state. When a public state is present, a slight modification of this rule yields the minimizer for the same objective. Sym-GUM, however, does not minimize transfer risk. The minimizer for that problem is instead the symmetrized version of a closely related GUM-like transfer rule. In both problems, the minimizing truthful total transfers are unique up to agent-specific constants summing to zero and events of probability zero.

Suggested Citation

  • Endre Cs'oka & M'at'e Viczi'an, 2026. "Risk-minimizing GUE-implementations of truthful reporting in a Dynamic Social Choice Problem," Papers 2610.10456, arXiv.org.
    • Handle: RePEc:arx:papers:2610.10456
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    References listed on IDEAS

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    1. Dirk Bergemann & Juuso Välimäki, 2019. "Dynamic Mechanism Design: An Introduction," Journal of Economic Literature, American Economic Association, vol. 57(2), pages 235-274, June.
    2. Susan Athey & Ilya Segal, 2013. "An Efficient Dynamic Mechanism," Econometrica, Econometric Society, vol. 81(6), pages 2463-2485, November.
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