This paper experimentally studies an essential institutional feature of matching markets: Randomization of allocation priorities. I compare single and multiple randomization in the student assignment problem with ties. The Gale-Shapley deferred acceptance algorithm is employed after...

Neeman (2004) and Heifetz and Neeman (2006) have shown that, in auctions with incomplete information about payoffs, full surplus extraction is only possible if agents’ beliefs about other agents are fully informative about their own payoff parameters. They argue that the set of...

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...

We study the relation between mechanism design and voting in public-good provision. If incentive mechanisms must satisfy conditions of coalition-proofness and robustness, as well as individual incentive compatibility, the participants' contributions to public-good provision can only depend on...

McAfee and Reny (1992) have given a necessary and sufficient condition for full surplus extraction in models with a continuum of types. We interpret their condition as significantly stronger version of the requirement of injectiveness of the function mapping abstract types into beliefs and prove...

In a large economy, a first-best provison rule for a public good is robustly implementable with budget balance because no one individual alone can affect the aggregate outcome. First-best outcomes can, however, be blocked by coalitions of agents acting in concert. With a requirement of immunity...

We study the provision of an excludable public good to discuss whether the imposition of participation constraints is desirable. It is shown that this question may equivalently be cast as follows: should a firm that produces a public good receive tax revenues, or face a self-financing...

We propose a new approach to the normative analysis of public-good provision in a large economy. Our analysis is based on a mechanism design approach that involves a requirement of coalition-proofness, as well as a requirement of robustness, so that the mechanism must not depend on specific...

We propose a new approach to the normative analysis of public-good provision. In addition to individual incentive compatibility, we impose conditions of robust implementability and coalition proofness. Under these additional conditions, participants' contributions can only depend on the level of...

This paper extends the model of optimal income taxation due to Mirrlees (1971) and includes private information on public goods preferences. A mechanism design approach is used to establish the following result: If policies are required to be robustly implementable in the sense of Bergemann and...