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Implementation in Iterative Elimination of Obviously Dominated Strategies: An Experiment on King Solomon's Dilemma

Author

Listed:
  • Makoto Hagiwara

    (Faculty of Economics, Osaka University of Economics, Research Institute for Economics and Business Administration, Kobe University, JAPAN)

  • Fumihiro Yonekura

    (School of Engineering, Tokyo Institute of Technology, Japan)

Abstract

"King Solomon's Dilemma" is based on a biblical story and this can be considered as an allocation problem for an indivisible object among two players. A social planner wants to assign the object without payment to the player whose valuation is the highest. We say that such an allocation is "first-best." We experimentally compare the relative performance of the mechanism of Mihara (Japanese Economic Review, 63(3), 420-429, 2012) and a mechanism which we modify Mihara's mechanism. We find that a modified Mihara's mechanism relatively works better than Mihara's mechanism from the following five view points: (1) the proportion of the first-best allocations; (2) the proportion of the right-player allocations; (3) resource inefficiency and wrong-player infficiency; (4) net mean efficiency; and (5) players' behavior.

Suggested Citation

  • Makoto Hagiwara & Fumihiro Yonekura, 2020. "Implementation in Iterative Elimination of Obviously Dominated Strategies: An Experiment on King Solomon's Dilemma," Discussion Paper Series DP2020-17, Research Institute for Economics & Business Administration, Kobe University.
    • Handle: RePEc:kob:dpaper:dp2020-17
    as

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    File URL: https://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/DP2020-17.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Implementation in iterative elimination of obviously dominated strategies; King Solomon's Dilemma; Mihara's mechanism; Ascending clock auctions; Laboratory experiment;
    All these keywords.

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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