Restricted Environments and Incentive Compatibility in Interdependent Values Models

We study the possibility of designing satisfactory ex post incentive compatible single valued direct mechanisms in interdependent values environments, characterized by the set of agents type profiles and by their induced preference profiles. For environments that we call knit and strict, only constant mechanisms can be ex post (or interim) incentive compatible. For those called partially knit, ex post incentive compatibility extends to groups, and strategy-proofnes implies strong group strategy-proofness in private values environments. The results extend to mechanisms operating on non-strict domains under an additional requirement of respectfulness. We discuss voting, assignment and auctions environments where our theorems apply.

Keywords: Mechanisms, Ex Post Incentive Compatibility, Ex Post Group Incentive Compatibility, Strategy-Proofness, Strong Group Strategy-Proofness, Knit environments, Respectfulness

JEL Classification: C78, D71, D78

Suggested Citation: Suggested Citation

Barberà, Salvador and Berga-Colom, Dolors and Moreno, Bernardo, Restricted Environments and Incentive Compatibility in Interdependent Values Models (July 9, 2018). Available at SSRN: https://ssrn.com/abstract=3135163 or http://dx.doi.org/10.2139/ssrn.3135163