Price & Choose
Federico Echenique, Mat\'ias N\'u\~nez

TL;DR
The paper introduces a two-stage mechanism called Price & Choose that ensures efficient outcomes in two-agent environments, extending to multiple players, non-quasi linear utilities, and robustness to strategic behaviors.
Contribution
It presents a novel mechanism that fully implements efficiency in complex settings, including multiple agents and non-quasi linear utilities, with considerations for fairness.
Findings
Mechanism achieves efficiency in two-agent settings.
Extended to multiple players and non-quasi linear utilities.
Addresses robustness to strategic max-min behavior.
Abstract
We describe a two-stage mechanism that fully implements the set of efficient outcomes in two-agent environments with quasi-linear utilities. The mechanism asks one agent to set prices for each outcome, and the other agent to make a choice, paying the corresponding price: Price \& Choose. We extend our implementation result in three main directions: an arbitrary number of players, non-quasi linear utilities, and robustness to max-min behavior. Finally, we discuss how to reduce the payoff inequality between players while still achieving efficiency.
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Taxonomy
TopicsAuction Theory and Applications · Economic theories and models · Game Theory and Applications
