TY - JOUR
T1 - Foundations of dominant-strategy mechanisms
AU - Chung, Kim-Sau
AU - Ely, J.C.
PY - 2007/4/1
Y1 - 2007/4/1
N2 - Robert Wilson criticizes applied game theory's reliance on common-knowledge assumptions. In reaction to Wilson's critique, the recent literature of mechanism design has adopted the goal of finding detail-free mechanisms in order to eliminate this reliance. In practice this has meant restricting attention to simple mechanisms such as dominant-strategy mechanisms. However, there has been little theoretical foundation for this approach. In particular it is not clear the search for an optimal mechanism that does not rely on common-knowledge assumption would lead to simpler mechanisms rather than more complicated ones. This paper tries to fill the void. In the context of an expected revenue maximizing auctioneer, we investigate some foundations for using simple, dominant-strategy auctions.
AB - Robert Wilson criticizes applied game theory's reliance on common-knowledge assumptions. In reaction to Wilson's critique, the recent literature of mechanism design has adopted the goal of finding detail-free mechanisms in order to eliminate this reliance. In practice this has meant restricting attention to simple mechanisms such as dominant-strategy mechanisms. However, there has been little theoretical foundation for this approach. In particular it is not clear the search for an optimal mechanism that does not rely on common-knowledge assumption would lead to simpler mechanisms rather than more complicated ones. This paper tries to fill the void. In the context of an expected revenue maximizing auctioneer, we investigate some foundations for using simple, dominant-strategy auctions.
UR - http://www.scopus.com/inward/record.url?eid=2-s2.0-33947700852&partnerID=MN8TOARS
U2 - 10.1111/j.1467-937X.2007.00427.x
DO - 10.1111/j.1467-937X.2007.00427.x
M3 - Journal article
SN - 0034-6527
VL - 74
SP - 447
EP - 476
JO - Review of Economic Studies
JF - Review of Economic Studies
IS - 2
ER -