Incentive compatible allocation and exchange of discrete resources
By Marek Pycia, M. Utku Ünver. 2015
174 citations recorded by the source corpus.
Allocation and exchange of discrete resources such as kidneys, school seats, and many other resources for which agents have single-unit demand is conducted via direct mechanisms without monetary transfers. Incentive compatibility and efficiency are primary concerns in designing such mechanisms. We show that a mechanism is indi- vidually strategy-proof and always selects the efficient outcome with respect to some Arrovian social welfare function if and only if the mechanism is group strategy-proof and Pareto efficient. We construct the full class of these mechanisms and show that each of them can be implemented by endowing agents with control rights over resources. This new class, which we call trading cycles, contains new mechanisms as well as known mechanisms such as top trading cycles, serial dictatorships, and hierarchical exchange. We illustrate how one can use our construction to show what can and what cannot be achieved in a variety of allocation and exchange problems, and we provide an example in which the new trading-cycles mechanisms strictly Lorenz dominate all previously known mechanisms.
Subfields: Economics and Econometrics, Management Science and Operations Research
View Paper: https://www.semanticscholar.org/paper/fef379d93e9c2eaa1e6bc657becb526e2927703c
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In Economics and Econometrics
In Management Science and Operations Research
Citations in the corpus
- Two axiomatic approaches to the probabilistic serial mechanism (2014, background): “They show that, in this case, there is a unique mechanism that is sd-efficient and sd-envyfree and that, in the limit of large markets, uniformly random versions of many known deterministic mechanisms such as serial dictatorships, hierarchical exchange rules (Pápai, 2000), and trading cycles mechani”
- A general equivalence theorem for allocation of indivisible objects (2014, background): “Sönmez and¨Unver [21] considered the following version of the core mechanism: initially, randomly allocate the unowned objects to the unendowed agents, and then run (the basic version of) TTC.”
- An alternative characterization of top trading cycles (2013, background): “Pycia and Unver (2010) introduce and characterize a generalization of top trading cycles they call trading cycles with brokers and owners.”