Designing stable mechanisms for economic environments

Artikel

We study the design of mechanisms that implement Lindahl or Walrasian allocations and whose Nash equilibria are dynamically stable for a wide class of adaptive dynamics. We argue that supermodularity is not a desirable stability criterion in this mechanism design context, focusing instead on contractive mechanisms. We provide necessary and sufficient conditions for a mechanism to Nash implement Lindahl or Walrasian allocations, show that these conditions are inconsistent with the contraction property when message spaces are one-dimensional, and then show how to use additional dimensions to achieve dynamic stability while gaining budget balance out of equilibrium.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: Theoretical Economics ; ISSN: 1555-7561 ; Volume: 7 ; Year: 2012 ; Issue: 3 ; Pages: 609-661 ; New Haven, CT: The Econometric Society

Classification and Topics

• Classification: Wirtschaft ; Existence and Stability Conditions of Equilibrium ; Noncooperative Games ; Stochastic and Dynamic Games; Evolutionary Games; Repeated Games ; Institutions: Design, Formation, Operations, and Impact ; Exchange and Production Economies
• Subject: Mechanism design ; implementation ; stability ; learning

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Healy, Paul J. ; Mathevet, Laurent
• Event: Veröffentlichung
• (who): The Econometric Society
• (where): New Haven, CT
• (when): 2012

Further information

• DOI: doi:10.3982/TE898
• Handle: http://hdl.handle.net/10419/150181
• Last update: 10.03.2025, 11:42 AM CET