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On the Equivalence of Bayesian and Dominant Strategy Implementation in a General Class of Social Choice Problems


Goeree, Jacob K; Kushnir, Alexey (2011). On the Equivalence of Bayesian and Dominant Strategy Implementation in a General Class of Social Choice Problems. Working paper series / Department of Economics No. 21, University of Zurich.

Abstract

We consider a standard social choice environment with linear utilities and independent, one-dimensional, private values. We provide a short and constructive proof that for any Bayesian incentive compatible mechanism there exists an equivalent dominant strategy incentive compatible mechanism that delivers the same interim expected utilities for all agents. We demonstrate the usefulness and applicability of our approach with several examples. Finally, we show that the equivalence between Bayesian and dominant strategy implementation breaks down when utilities are non-linear or when values are interdependent, multi-dimensional, or correlated.

Abstract

We consider a standard social choice environment with linear utilities and independent, one-dimensional, private values. We provide a short and constructive proof that for any Bayesian incentive compatible mechanism there exists an equivalent dominant strategy incentive compatible mechanism that delivers the same interim expected utilities for all agents. We demonstrate the usefulness and applicability of our approach with several examples. Finally, we show that the equivalence between Bayesian and dominant strategy implementation breaks down when utilities are non-linear or when values are interdependent, multi-dimensional, or correlated.

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Additional indexing

Item Type:Working Paper
Communities & Collections:03 Faculty of Economics > Department of Economics
Working Paper Series > Department of Economics
Dewey Decimal Classification:330 Economics
Language:English
Date:July 2011
Deposited On:25 Nov 2011 10:13
Last Modified:07 Dec 2017 09:53
Series Name:Working paper series / Department of Economics
ISSN:1664-7041
Official URL:http://www.econ.uzh.ch/wp.html
Related URLs:http://www.zora.uzh.ch/66228/

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