Eliciting the Socially Optimal Allocation from Responsible Agents

25 Pages Posted: 24 Feb 2017 Last revised: 20 Oct 2017

See all articles by Battal Dogan

Battal Dogan

Department of Economics, University of Bristol

Date Written: October 3, 2017

Abstract

We consider designing a mechanism to allocate objects among agents without monetary transfers. There is a socially optimal allocation, which is commonly known by the agents but not observable by the designer. The designer possibly has information about the existence of responsible agents. A responsible agent, when indifferent between his objects at two different allocations, prefers the first allocation to the second if the first allocation is closer to the optimal allocation than the second, in the sense that all the agents who are allocated their optimal objects in the second allocation are allocated their optimal objects also in the first allocation, and there is at least one more agent in the first allocation receiving his optimal object. We show that, if the designer knows that there are at least three responsible agents, even if the identities of the responsible agents are not known, the optimal allocation can be elicited.

Suggested Citation

Dogan, Battal, Eliciting the Socially Optimal Allocation from Responsible Agents (October 3, 2017). Available at SSRN: https://ssrn.com/abstract=2922522 or http://dx.doi.org/10.2139/ssrn.2922522

Battal Dogan (Contact Author)

Department of Economics, University of Bristol ( email )

United Kingdom

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