Implementation by Sortition in Nonexclusive Information Economies

Rene Saran and Norovsambuu Tumennasan ()
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Rene Saran: Yale University

Economics Working Papers from Department of Economics and Business Economics, Aarhus University

Abstract: We study the Bayesian implementation problem in economies that are divided into groups consisting of two or more individuals with the same information. Our results cover problems like that of allocating public funds among states, regulating activities causing externalities among firms, locating public facilities in neighborhoods, electing candidates from multiple districts etc. Instead of the standard communication protocol of direct democracy whereby the planner consults all individuals, we analyze sortition schemes whereby the planner consults only a subset of the individuals, called senators, who are selected via some kleroterion (i.e., a lottery machine) p. In general environments, under mild "economic" assumptions on preferences, we show that every social choice function (SCF) that is implementable by direct democracy is also p-implementable if p always selects two or more individuals from each group and the selection process does not partition any group into "disconnected" subgroups (in the sense that individuals belonging to different subgroups are never selected together). In quasilinear environments satisfying a generic condition on individuals' beliefs, every SCF can be implemented by a simple and economically meaningful mechanism in which the kleroterion selects a predesignated group leader and one other randomly chosen individual from each group.

Keywords: Bayesian implementation; Nonexclusive information; p-Implementation; Sortition (search for similar items in EconPapers)
JEL-codes: C72 D02 D82 (search for similar items in EconPapers)
Pages: 37
Date: 2015-05-26
New Economics Papers: this item is included in nep-cdm and nep-mic
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