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Full Implementation of Rank Dependent Prizes


  • Midjord, Rune


A manager/mechanism designer must allocate a set of money prizes ($1, $2, .., $n) between n agents working in a team. The agents know the state i.e. who contributed most, second most, etc. The agents' prefer- ences over prizes are state independent. We incorporate the possibility that the manager knows the state with a tiny probability and present a simple mechanism that uniquely implement prizes that respects the true state.

Suggested Citation

  • Midjord, Rune, 2012. "Full Implementation of Rank Dependent Prizes," DFAEII Working Papers 2012-15, University of the Basque Country - Department of Foundations of Economic Analysis II.
  • Handle: RePEc:ehu:dfaeii:8771

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    References listed on IDEAS

    1. Dutta, Bhaskar & Sen, Arunava, 2012. "Nash implementation with partially honest individuals," Games and Economic Behavior, Elsevier, vol. 74(1), pages 154-169.
    2. George Baker & Michael Gibbs & Bengt Holmstrom, 1994. "The Wage Policy of a Firm," The Quarterly Journal of Economics, Oxford University Press, vol. 109(4), pages 921-955.
    3. Matsushima, Hitoshi, 2008. "Role of honesty in full implementation," Journal of Economic Theory, Elsevier, vol. 139(1), pages 353-359, March.
    4. Bognanno, Michael L, 2001. "Corporate Tournaments," Journal of Labor Economics, University of Chicago Press, vol. 19(2), pages 290-315, April.
    5. Eric Maskin, 1999. "Nash Equilibrium and Welfare Optimality," Review of Economic Studies, Oxford University Press, vol. 66(1), pages 23-38.
    6. Kartik, Navin & Tercieux, Olivier, 2012. "Implementation with evidence," Theoretical Economics, Econometric Society, vol. 7(2), May.
    7. Matsushima, Hitoshi, 2008. "Behavioral aspects of implementation theory," Economics Letters, Elsevier, vol. 100(1), pages 161-164, July.
    8. Kartik, Navin & Tercieux, Olivier & Holden, Richard, 2014. "Simple mechanisms and preferences for honesty," Games and Economic Behavior, Elsevier, vol. 83(C), pages 284-290.
    9. Ben-Porath, Elchanan & Lipman, Barton L., 2012. "Implementation with partial provability," Journal of Economic Theory, Elsevier, vol. 147(5), pages 1689-1724.
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    More about this item


    full implementation; direct mechanism; verifiable information; rank order tournaments;

    JEL classification:

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

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