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Mechanism Design and Intentions

Listed author(s):
  • Felix Bierbrauer

    ()

    (Max Planck Institute for Research on Collective Goods, Bonn)

  • Nick Netzer

    ()

    (University of Zurich)

We introduce intention-based social preferences into mechanism design. We explore information structures that dier with respect to what is commonly known about the weight that agents attach to reciprocal kindness. When the designer has no information on reciprocity types, implementability of an incentive-compatible social choice function is guaranteed if it satises an additional insurance property. By contrast, precise information on reciprocity types may imply that all ecient social choice functions are implementable. We show how these results extend to a two-dimensional mechanism design setting where the agents have private information about their material payo types and their reciprocity types. We also provide a systematic account of the welfare implications of intentionality.

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Paper provided by Max Planck Institute for Research on Collective Goods in its series Discussion Paper Series of the Max Planck Institute for Research on Collective Goods with number 2016_04.

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Date of creation: Feb 2016
Handle: RePEc:mpg:wpaper:2016_04
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