Ordinal Simplicity and Auditability in Discrete Mechanism Design

37 Pages Posted: 18 Nov 2023

See all articles by Marek Pycia

Marek Pycia

University of Zurich

M. Utku Ünver

Boston College - Department of Economics

Date Written: October 15, 2023

Abstract

Designing mechanisms for environments without transfers, market designers usually restrict attention to ordinal mechanisms. Ordinal mechanisms are simpler for both designers and participants but miss potentially welfare-relevant information. Under what conditions focusing on ordinal mechanisms is without loss? We show that, in general, all group strategy-proof mechanisms are ordinal. All mechanisms maximizing an Arrovian social welfare function are ordinal; in a large class of environments, such Arrovian efficiency is implied by Pareto efficiency and a simple auditability condition. Strategy-proof mechanisms that are simple to audit are also ordinal. As applications, we characterize important classes of mechanisms in public choice as well as single-unit-demand and multiple-unit-demand allocation of private goods.

Keywords: Ordinality, simplicity, strategy-proofness, auditability, non-bossiness, Pareto efficiency, welfare maximization, Arrovian efficiency, rich domains, public choice, house allocation, single-unit demand, multi-unit demand

JEL Classification: C78, D78

Suggested Citation

Pycia, Marek and Ünver, M. Utku, Ordinal Simplicity and Auditability in Discrete Mechanism Design (October 15, 2023). Available at SSRN: https://ssrn.com/abstract=4609262 or http://dx.doi.org/10.2139/ssrn.4609262

Marek Pycia

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

M. Utku Ünver (Contact Author)

Boston College - Department of Economics ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

HOME PAGE: http://sites.bc.edu/utku-unver

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
51
Abstract Views
298
Rank
712,810
PlumX Metrics