California Institute of Technology

Division of the Humanities and Social Sciences

Incentive Compatible Market Design with an Application to Matching with Wages

25 Baxter
Tuesday February 9, 2010 4:00 PM
Mehmet Bumin Yenmez, graduate student in business, Stanford University
This paper studies markets for heterogeneous goods using mechanism-design theory. For each combination of desirable properties, I derive an assignment process with these properties in the form of a corresponding direct-revelation game, or I show that it does not exist. Each participant's preferences are quasi-linear in money, and depend upon the allocation that he gets - thus, a participant's privately known type is multidimensional. The key properties are individual rationality, incentive compatibility, budget balance, efficiency, and stability against coalitional deviations. The main results characterize mechanisms that are ex post incentive compatible in combination with other properties.

The paper can be found at the following link: http://www.stanford.edu/~byenmez/Yenmez_Bumin_JMP.pdf

Series: Ulric B. and Evelyn L. Bray Seminar
For more information, please phone Ext. 3773 or email tiffany@hss.caltech.edu

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