Publication Type
Working Paper
Version
publishedVersion
Publication Date
11-2018
Abstract
This paper characterizes mechanisms satisfying Bayesian incentive compatibility (BIC) and interim individual rationality (IIR) in the classical public good provision problem. Many papers in the literature obtain the results in the so-called standard model of ex ante identical agents with a continuous, closed interval of types. Although the standard model and more generally a continuum type space are widely used in the literature, it is nonetheless an abstraction of reality. Given that the public good provision problem has occupied a central application in the theory of mechanism design, we propose a "stress test" for the results in the standard model by subjecting them to a fi nite discretization over the standard model. The main contribution of this paper is that many of the known results gained within the standard continuum type space also hold when it is replaced by a discrete type space.
Keywords
Budget balance, decision efficiency, incentive compatibility, individual rationality; mechanisms; public goods
Discipline
Economics | Economic Theory
Research Areas
Economic Theory
First Page
1
Last Page
45
Publisher
SMU Economics and Statistics Working Paper Series, No. 21-2018
City or Country
Singapore
Citation
KUNIMOTO, Takashi and ZHANG, Cuiling.
On incentive compatible, individually rational public good provision mechanisms. (2018). 1-45.
Available at: https://ink.library.smu.edu.sg/soe_research/2212
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.