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On Sharing the Benefits of Communication

Author

Listed:
  • Efthymios Athanasiou

    (Dep. of Philosophy, CMU)

  • Santanu Dey

    (ISYE, Georgia Tech)

  • Giacomo Valleta

    (Dep. of Economics, Maastricht)

Abstract

We put forward a model of private goods with externalities. Agents derive benefit from communicating with each other. In order to communicate they need to have a language in common. Learning languages is costly. In this setting no individually rational and feasible Groves mechanism exists. We characterize the best-in-class feasible Groves mechanism and the best-in-class individually rational Groves mechanism.

Suggested Citation

  • Efthymios Athanasiou & Santanu Dey & Giacomo Valleta, 2012. "On Sharing the Benefits of Communication," Working Papers 2012.41, Fondazione Eni Enrico Mattei.
    • Handle: RePEc:fem:femwpa:2012.41
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    References listed on IDEAS

    as
    1. Moulin, Hervé, 2009. "Almost budget-balanced VCG mechanisms to assign multiple objects," Journal of Economic Theory, Elsevier, vol. 144(1), pages 96-119, January.
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    7. Athanasiou, Efthymios, 2013. "A Solomonic solution to the problem of assigning a private indivisible good," Games and Economic Behavior, Elsevier, vol. 82(C), pages 369-387.
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    More about this item

    Keywords

    Groves Mechanisms; Externality; Budget Surplus or Deficit; Pareto Undominated Mechanisms;
    All these keywords.

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • C60 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - General

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