Efficient Auctions and Interdependent Types

16 Pages Posted: 18 Jan 2012

See all articles by Dirk Bergemann

Dirk Bergemann

Yale University - Cowles Foundation - Department of Economics; Yale University - Cowles Foundation

Stephen Morris

MIT

Satoru Takahashi

National University of Singapore (NUS) - Department of Economics

Date Written: January 18, 2012

Abstract

We consider the efficient allocation of a single good with interdependent values in a quasi-linear environment. We present an approach to modelling interdependent preferences distinguishing between "payoff types" and "belief types" and report a characterization of when the efficient allocation can be partially Bayesian implemented on a finite type space. The characterization can be used to unify a number of sufficient conditions for efficient partial implementation in this classical auction setting.

We report how a canonical language for discussing interdependent types -- developed in a more general setting by Bergemann, Morris and Takahashi (2011) -- applies in this setting and note by example that this canonical language will not allow us to distinguish some types in the payoff type -- belief type language.

Keywords: Mechanism Design, Robust mechanism design, Efficient auctions, Interdepedent types, Partial implementation, Full implementation

JEL Classification: C79, D82

Suggested Citation

Bergemann, Dirk and Morris, Stephen Edward and Takahashi, Satoru, Efficient Auctions and Interdependent Types (January 18, 2012). Cowles Foundation Discussion Paper No. 1846, Economic Theory Center Working Paper No. 30-2012, Available at SSRN: https://ssrn.com/abstract=1987580 or http://dx.doi.org/10.2139/ssrn.1987580

Dirk Bergemann (Contact Author)

Yale University - Cowles Foundation - Department of Economics ( email )

28 Hillhouse Ave
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203-432-3592 (Phone)
203-432-2128 (Fax)

HOME PAGE: http://www.econ.yale.edu/~dirk/

Yale University - Cowles Foundation

Box 208281
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Stephen Edward Morris

MIT ( email )

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Cambridge, MA 02139-4307
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HOME PAGE: http://https://economics.mit.edu/faculty/semorris

Satoru Takahashi

National University of Singapore (NUS) - Department of Economics ( email )

1 Arts Link, AS2 #06-02
Singapore 117570, Singapore 119077
Singapore

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