A Tight Sufficient Condition for Recursive Formulation of Dynamic Implementation Problems

21 Pages Posted: 17 Jun 2016

See all articles by George Lukyanov

George Lukyanov

University of Toulouse 1 - Toulouse School of Economics (TSE)

Eric Mengus

HEC Paris - Economics & Decision Sciences

Date Written: June 9, 2016

Abstract

This note explores conditions that admit recursive representation for a class of dynamic mechanism design problems. We derive a tight sufficient condition, called the common state property (CSP), which ensures that temporary incentive constraints guarantee implementability, and so allows to characterize the principal's problem recursively. The condition imposes no restrictions on agent's preferences and only concerns the properties of the evolution of private information.

Keywords: First order approach, Dynamic mechanism design

JEL Classification: D30, D80, D82

Suggested Citation

Lukyanov, George and Mengus, Eric, A Tight Sufficient Condition for Recursive Formulation of Dynamic Implementation Problems (June 9, 2016). HEC Paris Research Paper No. ECO/SCD-2016-1151. Available at SSRN: https://ssrn.com/abstract=2795572 or http://dx.doi.org/10.2139/ssrn.2795572

George Lukyanov

University of Toulouse 1 - Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

Eric Mengus (Contact Author)

HEC Paris - Economics & Decision Sciences ( email )

Paris
France

Register to save articles to
your library

Register

Paper statistics

Downloads
60
rank
348,859
Abstract Views
940
PlumX Metrics