IDEAS home Printed from https://ideas.repec.org/a/spr/joecth/v39y2009i3p505-512.html
   My bibliography  Save this article

Choosing wisely: the natural multi-bidding mechanism

Author

Listed:
  • Lars Ehlers

Abstract

Pérez-Castrillo and Wettstein (2002) propose a multi-bidding mechanism to determine a winner from a set of possible projects. The winning project is implemented and its surplus is shared among the agents. In the multi-bidding mechanism each agent announces a vector of bids, one for each possible project, that are constrained to sum up to zero. In addition, each agent chooses a favorite a object which is used as a tie-breaker if several projects receive the same highest aggregate bid. Since more desirable projects receive larger bids, it is natural to consider the multi-bidding mechanism without the announcement of favorite projects. We show that the merits of the multi-bidding mechanism appear not to be robust to this natural simplification. Specifically, a Nash equilibrium exists if and only if there are at least two individually optimal projects and all individually optimal projects are efficient.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Lars Ehlers, 2009. "Choosing wisely: the natural multi-bidding mechanism," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 39(3), pages 505-512, June.
  • Handle: RePEc:spr:joecth:v:39:y:2009:i:3:p:505-512
    DOI: 10.1007/s00199-008-0355-7
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s00199-008-0355-7
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1007/s00199-008-0355-7?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Vidal-Puga, Juan & Bergantinos, Gustavo, 2003. "An implementation of the Owen value," Games and Economic Behavior, Elsevier, vol. 44(2), pages 412-427, August.
    2. David Pérez-Castrillo & David Wettstein, 2002. "Choosing Wisely: A Multibidding Approach," American Economic Review, American Economic Association, vol. 92(5), pages 1577-1587, December.
    3. Róbert Veszteg, 2010. "Multibidding game under uncertainty," Review of Economic Design, Springer;Society for Economic Design, vol. 14(3), pages 311-329, September.
    4. Perez-Castrillo, David & Wettstein, David, 2001. "Bidding for the Surplus : A Non-cooperative Approach to the Shapley Value," Journal of Economic Theory, Elsevier, vol. 100(2), pages 274-294, October.
    5. Jehiel, Philippe & Moldovanu, Benny & Stacchetti, Ennio, 1999. "Multidimensional Mechanism Design for Auctions with Externalities," Journal of Economic Theory, Elsevier, vol. 85(2), pages 258-293, April.
    6. Mutuswami, Suresh & Perez-Castrillo, David & Wettstein, David, 2004. "Bidding for the surplus: realizing efficient outcomes in economic environments," Games and Economic Behavior, Elsevier, vol. 48(1), pages 111-123, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Licun Xue & Lingling Zhang, 2012. "Bidding and sequential coalition formation with externalities," International Journal of Game Theory, Springer;Game Theory Society, vol. 41(1), pages 49-73, February.
    2. Laurent-Lucchetti, Jérémy & Leroux, Justin, 2011. "Choosing and sharing," Games and Economic Behavior, Elsevier, vol. 73(1), pages 296-300, September.
    3. Pérez-Castrillo, David & Quérou, Nicolas, 2012. "Smooth multibidding mechanisms," Games and Economic Behavior, Elsevier, vol. 76(2), pages 420-438.
    4. Toyotaka Sakai, 2012. "Fair waste pricing: an axiomatic analysis to the NIMBY problem," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 50(2), pages 499-521, June.
    5. Federico Echenique & Mat'ias N'u~nez, 2022. "Price & Choose," Papers 2212.05650, arXiv.org, revised Apr 2023.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. van den Brink, René & van der Laan, Gerard & Moes, Nigel, 2013. "A strategic implementation of the Average Tree solution for cycle-free graph games," Journal of Economic Theory, Elsevier, vol. 148(6), pages 2737-2748.
    2. Gustavo Bergantiños & Juan Vidal-Puga, 2004. "Realizing efficient outcomes in cost spanning problems," Game Theory and Information 0403001, University Library of Munich, Germany.
    3. Pérez-Castrillo, David & Quérou, Nicolas, 2012. "Smooth multibidding mechanisms," Games and Economic Behavior, Elsevier, vol. 76(2), pages 420-438.
    4. Kamijo, Yoshio, 2008. "Implementation of weighted values in hierarchical and horizontal cooperation structures," Mathematical Social Sciences, Elsevier, vol. 56(3), pages 336-349, November.
    5. Yuan Ju & David Wettstein, 2009. "Implementing cooperative solution concepts: a generalized bidding approach," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 39(2), pages 307-330, May.
    6. David Pérez-Castrillo & David Wettstein, 2005. "Implementation of the Ordinal Shapley Value for a three-agent economy," Economics Bulletin, AccessEcon, vol. 3(48), pages 1-8.
    7. Macho-Stadler, Ines & Perez-Castrillo, David & Wettstein, David, 2006. "Efficient bidding with externalities," Games and Economic Behavior, Elsevier, vol. 57(2), pages 304-320, November.
    8. Licun Xue & Lingling Zhang, 2012. "Bidding and sequential coalition formation with externalities," International Journal of Game Theory, Springer;Game Theory Society, vol. 41(1), pages 49-73, February.
    9. Borm, Peter & Ju, Yuan & Wettstein, David, 2015. "Rational bargaining in games with coalitional externalities," Journal of Economic Theory, Elsevier, vol. 157(C), pages 236-254.
    10. Slikker, Marco, 2007. "Bidding for surplus in network allocation problems," Journal of Economic Theory, Elsevier, vol. 137(1), pages 493-511, November.
    11. Bergantiños, Gustavo & Vidal-Puga, Juan, 2010. "Realizing fair outcomes in minimum cost spanning tree problems through non-cooperative mechanisms," European Journal of Operational Research, Elsevier, vol. 201(3), pages 811-820, March.
    12. Sylvain Béal & Eric Rémila & Philippe Solal, 2017. "Axiomatization and implementation of a class of solidarity values for TU-games," Theory and Decision, Springer, vol. 83(1), pages 61-94, June.
    13. Pintér, Ágnes & Veszteg, Róbert F., 2010. "Minority vs. majority: An experimental study of standardized bids," European Journal of Political Economy, Elsevier, vol. 26(1), pages 36-50, March.
    14. Ander Perez-Orive & Andrea Caggese, 2017. "Capital Misallocation and Secular Stagnation," 2017 Meeting Papers 382, Society for Economic Dynamics.
    15. Yoshio Kamijo, 2013. "The collective value: a new solution for games with coalition structures," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 21(3), pages 572-589, October.
    16. Vidal-Puga, Juan, 2013. "A non-cooperative approach to the ordinal Shapley rule," MPRA Paper 43790, University Library of Munich, Germany.
    17. Navarro Noemí & Perea Andres, 2013. "A Simple Bargaining Procedure for the Myerson Value," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 13(1), pages 131-150, May.
    18. Sylvain Béal & Sylvain Ferrières & Eric Rémila & Philippe Solal, 2017. "Axiomatic and bargaining foundation of an allocation rule for ordered tree TU-games," Post-Print halshs-01644797, HAL.
    19. Laurent-Lucchetti, Jérémy & Leroux, Justin, 2011. "Choosing and sharing," Games and Economic Behavior, Elsevier, vol. 73(1), pages 296-300, September.
    20. Perez-Castrillo, David & Wettstein, David, 2005. "Forming efficient networks," Economics Letters, Elsevier, vol. 87(1), pages 83-87, April.

    More about this item

    Keywords

    (Natural) Multi-bidding mechanism; Existence; Efficiency; D62; D78;
    All these keywords.

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:joecth:v:39:y:2009:i:3:p:505-512. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.