Serial Vickrey Mechanism
ISER DP No. 1095, July 2020
55 Pages Posted: 17 Sep 2020
Date Written: July 30, 2020
We study an assignment market where multiple heterogenous objects are sold to unit demand agents who have general preferences accommodating imperfect transferability of utility and income effects. In such a model, there is a minimum price equilibrium. We establish the structural characterizations of minimum price equilibria and employ these results to design the "Serial Vickrey mechanism," that finds a minimum price equilibrium in a finite number of steps. The Serial Vickrey mechanism introduces the objects one by one, and requires agents to report finite-dimensional prices in finitely many times. Besides, the Serial Vickrey mechanism also has nice dynamic incentive properties.
Keywords: the assignment market, minimum price equilibrium, general preferences, structural characterizations, Serial Vickrey mechanism, dynamic incentive compatibility
JEL Classification: C63, C70, D44
Suggested Citation: Suggested Citation