Multiagent mechanism design without money

Published

Journal Article

© 2019 INFORMS. We consider a principal repeatedly allocating a single resource in each period to one of multiple agents, whose values are private, without relying on monetary payments over an infinite horizon with discounting. We design a dynamic mechanism that induces agents to report their values truthfully in each period via promises/threats of future favorable/unfavorable allocations. We show that our mechanism asymptotically achieves the first-best efficient allocation (the welfare-maximizing allocation as if values are public) as agents become more patient and provide sharp characterizations of convergence rates to first best as a function of the discount factor. In particular, in the case of two agents we prove that the convergence rate of our mechanism is optimal - that is, no other mechanism can converge faster to first best.

Full Text

Duke Authors

Cited Authors

  • Balseiro, SR; Gurkan, H; Sun, P

Published Date

  • January 1, 2019

Published In

Volume / Issue

  • 67 / 5

Start / End Page

  • 1417 - 1436

Electronic International Standard Serial Number (EISSN)

  • 1526-5463

International Standard Serial Number (ISSN)

  • 0030-364X

Digital Object Identifier (DOI)

  • 10.1287/opre.2018.1820

Citation Source

  • Scopus