Showing 1 - 10 of 375
In this paper we develop a differentiable approach to deal with incentives in a, possibly small, subset of a general domain of preferences in economies with one public and one private good. We show that, for two agents, there is no social rule which is efficient, nondictatorial and...
Many policies simultaneously affect the distribution of prices and incomes in the economy. Moreover, a bias may occur when there is a stochastic relationship between prices and incomes and this relationship is being ignored. It is therefore important to dispose of an analytical framework for...
This paper takes a mechanism design approach to federalism and assumes that local preferences are the private information of local jurisdictions. Contractual federalism is defined as a strategy-proof contract among the members of the federation supervised by a benevolent but not omniscient...
In n-agent exchange economies, we show that all efficient and continuous rules are "diagonally dictatorial" over the restricted domain of linear preferences and, in the 2-good case, over the domain of homothetic preferences. The diagonal dictator receives the entire endowment whenever all agents...
This paper studies the strategic foundations of the Representative Voter Theorem (Rothstein, 1991), also called the second version of the Median Voter Theorem. As a by-product, it also considers the existence of non-trivial strategy-proof social choice functions over the domain of...
We consider the problem of allocating several types of indivisible goods when preferences are separable and monetary transfers are not allowed. Our finding is that the coordinatewise application of strategy-proof and non-wasteful rules yields a strategy-proof rule with the following efficiency...
Unsophisticated applicants can be at a disadvantage under manipulable and hence strategically demanding school choice mechanisms. Disclosing information on applications in previous admission periods makes it easier to asses the chances of being admitted at a particular school, and hence may...
We take school admission mechanisms to the lab to test whether the widely-used manipulable Boston-mechanism disadvantages students of lower cognitive ability and whether this leads to ability segregation across schools. Results show this is the case: lower ability participants receive lower...
Strategy-proofness, requiring that truth-telling be a dominant strategy, is a standard concept in social choice theory. However, this concept has serious drawbacks. In particular, many strategy-proof mechanisms have multiple Nash equilibria, some of which produce the wrong outcome. A possible...