Preference Revelation Games and Strong Cores of Allocation Problems with Indivisibilities
This paper studies the incentive compatibility of solutions to generalized indivisible good allocation problems introduced by Sonmez (1999), which contain the well-known marriage problems (Gale and Shapley, 1962) and the housing markets (Shapley and Scarf, 1974) as special cases. In particular, I consider the vulnerability to manipulation of solutions that are individually rational and Pareto optimal. By the results of Sonmez (1999) and Takamiya (2003), any individually rational and Pareto optimal solution is strategy-proof if and only if the strong core correspondence is essentially single-valued, and the solution is a strong core selection. Given this fact, this paper examines the equilibrium outcomes of the preference revelation games when the strong core correspondence is not necessarily essentially single-valued. I show that for the preference revelation games induced by any solution which is individually rational and Pareto optimal, the set of strict strong Nash equilibrium outcomes coincides with the strong core. This generalizes one of the results by Shin and Suh (1996) obtained in the context of the marriage probelms. Further, I examine the other preceding results proved for the marriage problems (Alcalde, 1996; Shin and Suh, 1996; Sonmez, 1997) to find that none of those results are generalized to the general model.
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- Koji Takamiya, 2003. "On strategy-proofness and essentially single-valued cores: A converse result," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 20(1), pages 77-83.
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Elsevier, vol. 69(1), pages 240-254, April.
- José Alcalde, 1995. "Implementation of Stable Solutions to Marriage Problems," Working Papers. Serie AD 1995-05, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
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in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 1, chapter 16, pages 485-541
- Shin, Sungwhee & Suh, Sang-Chul, 1996. "A mechanism implementing the stable rule in marriage problems," Economics Letters, Elsevier, vol. 51(2), pages 185-189, May.
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