A note on revelation principle from an energy perspective

TL;DR

This paper examines the revelation principle through an energy lens, highlighting the need for an energy condition when agents' strategies are actions instead of messages, to ensure the principle's validity in practice.

Contribution

It introduces an energy perspective to the revelation principle, proposing an additional energy condition for its applicability when strategies are actions.

Findings

Energy considerations affect the validity of the revelation principle.

An additional energy condition is necessary for the principle to hold with actions.

The paper extends the theoretical understanding of mechanism design from an energy perspective.

Abstract

The revelation principle has been known in the economics society for decades. In this paper, I will investigate it from an energy perspective, i.e., considering the energy consumed by agents and the designer in participating a mechanism. The main result is that when the strategies of agents are actions rather than messages, an additional energy condition should be added to make the revelation principle hold in the real world.