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Universal Mechanisms and Moral Preferences in Implementation


  • Hitoshi Matsushima

    (Faculty of Economics, University of Tokyo)


This paper reconsiders implementation of social choice functions defined as mapping from states to consequences, where we require the uniqueness of equilibrium outcome at every state. In contrast with the standard models, we construct only mechanisms that are universal, i.e., are free from the detail of the model specification such as the set of states, and allow each agent to have small moral preference. We show that a single mechanism can implement every incentive compatible social choice function. Moral preferences serve not only to eliminate unwanted equilibria but also to make the central planner's information processing simplified as much as possible in ways that each agent will translate her indescribable private signal into the describable characteristic of the socially optimal alternative.

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  • Hitoshi Matsushima, 2003. "Universal Mechanisms and Moral Preferences in Implementation," CIRJE F-Series CIRJE-F-254, CIRJE, Faculty of Economics, University of Tokyo.
  • Handle: RePEc:tky:fseres:2003cf254

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    References listed on IDEAS

    1. Matsushima Hitoshi, 1993. "Bayesian Monotonicity with Side Payments," Journal of Economic Theory, Elsevier, vol. 59(1), pages 107-121, February.
    2. Glazer, Jacob & Rubinstein, Ariel, 1998. "Motives and Implementation: On the Design of Mechanisms to Elicit Opinions," Journal of Economic Theory, Elsevier, vol. 79(2), pages 157-173, April.
    3. Kfir Eliaz, 2002. "Fault Tolerant Implementation," Review of Economic Studies, Oxford University Press, vol. 69(3), pages 589-610.
    4. Hart, Oliver, 1995. "Firms, Contracts, and Financial Structure," OUP Catalogue, Oxford University Press, number 9780198288817.
    5. Roberto Serrano & Rajiv Vohra, 2000. "Type Diversity and Virtual Bayesian Implementation Creation-Date: 2000," Working Papers 2000-16, Brown University, Department of Economics.
    6. Alger, Ingela & Albert Ma, Ching-to, 2003. "Moral hazard, insurance, and some collusion," Journal of Economic Behavior & Organization, Elsevier, vol. 50(2), pages 225-247, February.
    7. Brian Erard & Jonathan S. Feinstein, 1994. "Honesty and Evasion in the Tax Compliance Game," RAND Journal of Economics, The RAND Corporation, vol. 25(1), pages 1-19, Spring.
    8. Jean Tirole, 1999. "Incomplete Contracts: Where Do We Stand?," Econometrica, Econometric Society, vol. 67(4), pages 741-782, July.
    9. Abreu, Dilip & Matsushima, Hitoshi, 1992. "Virtual Implementation in Iteratively Undominated Strategies: Complete Information," Econometrica, Econometric Society, vol. 60(5), pages 993-1008, September.
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    Cited by:

    1. Hitoshi Matsushima, 2005. "On Detail-Free Mechanism Design And Rationality," The Japanese Economic Review, Japanese Economic Association, vol. 56(1), pages 41-54.

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