Secure Implementation:Strategy-Proof Mechanisms Reconsidered
Strategy-proofness, requiring that truth-telling is a dominant strategy, is a standard concept in social choice theory. However, the concept of strategy-proofness has serious drawbacks. First, announcing one's true preference may not be a unique dominant strategy, and using the wrong dominant strategy may lead to the wrong outcome. Second, almost all strategy-proof mechanisms have a continuum of Nash equilibria, and some of which produce the wrong outcome. Third, experimental evidence shows that most of the strategy-proof mechanisms do not work well. We argue that a possible solution to this dilemma is to require double implementation in Nash equilibrium and in dominant strategies, which we call secure implementation. We characterize environments where secure implementation is possible, and compare it with dominant strategy implementation. An interesting example of secure implementation is a Groves mechanism when preferences are single-peaked.
|Date of creation:||Sep 2003|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.rieti.go.jp/
More information through EDIRC
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.:
- Tatsuyoshi Saijo & Tomas Sjöström & Takehiko Yamato, 2004.
122247000000000615, UCLA Department of Economics.
- Cason, Timothy N. & Saijo, Tatsuyoshi & Sjostrom, Tomas & Yamato, Takehiko, 2006.
"Secure implementation experiments: Do strategy-proof mechanisms really work?,"
Games and Economic Behavior,
Elsevier, vol. 57(2), pages 206-235, November.
- Timothy N. Cason & Tatsuyoshi Saijo & Tomas Sjostrom & Takehiko Yamato, 2005. "Secure Implementation Experiments: Do Strategy-proof Mechanisms Really Work?," Economics Working Papers 0055, Institute for Advanced Study, School of Social Science.
- Cason, Timothy N. & Saijo, Tatsuyoshi & Sjostrom, Tomas & Yamato, Takehiho, 2003. "Secure Implementation Experiments: Do Strategy-Proof Mechanisms Really Work?," Working Papers 1165, California Institute of Technology, Division of the Humanities and Social Sciences.
- Cason, Timothy N. & Saijo, Tatsuyoshi & Sjostrom, Tomas & Yamato, Takehiko, 2003. "Secure Implementation Experiments: Do Strategy-proof Mechanisms Really Work?," Working Papers 4-03-1, Pennsylvania State University, Department of Economics.
- Tatsuyoshi Saijo & Timothy N. Cason & Tomas Sjostrom, 2003. "Secure Implementation Experiments:Do Strategy-proof Mechanisms Really Work?," Discussion papers 03012, Research Institute of Economy, Trade and Industry (RIETI).
- Kagel, J.H. & Levin, D., 1988.
"Independent Private Value Auctions: Bidder Behavior In First, Second And Third-Price Auctions With Varying Numbers Of Bidders,"
13, Houston - Department of Economics.
- Kagel, John H & Levin, Dan, 1993. "Independent Private Value Auctions: Bidder Behaviour in First-, Second- and Third-Price Auctions with Varying Numbers of Bidders," Economic Journal, Royal Economic Society, vol. 103(419), pages 868-79, July.
- Moulin, Herve & Shenker, Scott, 1992. "Serial Cost Sharing," Econometrica, Econometric Society, vol. 60(5), pages 1009-37, September.
- Masso, J. & Barbera, S., 1996.
"Strategy-Proof Voting on Compact Ranges,"
ASSET - Instituto De Economia Publica
156, ASSET (Association of Southern European Economic Theorists).
- Laura Razzolini & Michael Reksulak & Robert Dorsey, 2004.
"An Experimental Evaluation of the Serial Cost Sharing Rule,"
0402, VCU School of Business, Department of Economics.
- Laura Razzolini & Michael Reksulak & Robert Dorsey, 2007. "An Experimental Evaluation of the Serial Cost Sharing Rule," Theory and Decision, Springer, vol. 63(3), pages 283-314, November.
- repec:oup:restud:v:52:y:1985:i:2:p:223-29 is not listed on IDEAS
- repec:oup:restud:v:50:y:1983:i:1:p:153-70 is not listed on IDEAS
- James Schummer & Rakesh V. Vohra, 1999.
"Strategy-proof Location on a Network,"
1253, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Kagel, John H & Harstad, Ronald M & Levin, Dan, 1987. "Information Impact and Allocation Rules in Auctions with Affiliated Private Values: A Laboratory Study," Econometrica, Econometric Society, vol. 55(6), pages 1275-1304, November.
- Kawagoe, Toshiji & Mori, Toru, 2001. " Can the Pivotal Mechanism Induce Truth-Telling? An Experimental Study," Public Choice, Springer, vol. 108(3-4), pages 331-54, September.
- repec:oup:restud:v:57:y:1990:i:3:p:453-75 is not listed on IDEAS
- repec:oup:restud:v:61:y:1994:i:2:p:305-25 is not listed on IDEAS
- H. Moulin, 1980. "On strategy-proofness and single peakedness," Public Choice, Springer, vol. 35(4), pages 437-455, January.
- Attiyeh, Greg & Franciosi, Robert & Isaac, R Mark, 2000. " Experiments with the Pivot Process for Providing Public Goods," Public Choice, Springer, vol. 102(1-2), pages 95-114, January.
- Groves, Theodore, 1973. "Incentives in Teams," Econometrica, Econometric Society, vol. 41(4), pages 617-31, July.
When requesting a correction, please mention this item's handle: RePEc:eti:dpaper:03019. 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: (NUKATANI Sorahiko)
If references are entirely missing, you can add them using this form.