Price & Choose

Federico Echenique () and Matias Nuñez
Additional contact information
Federico Echenique: UC Berkeley

No 2024-15, Working Papers from Center for Research in Economics and Statistics

Abstract: We describe a sequential mechanism that fully implements the set of efficient outcomes in environments with quasi-linear utilities. The mechanism asks agents to take turns in defining prices for each outcome, with a final player choosing an outcome for all: Price & Choose. The choice triggers a sequence of payments, from each agent to the preceding agent. We present several extensions. First, payoff inequalities may be reduced by endogenizing the order of play. Second, our results extend to a model without quasi-linear utility, to a setting with an outside option, robustness to max-min behavior and caps on prices.

Keywords: Efficiency; Subgame-perfect implementation; Mechanism; Prices. (search for similar items in EconPapers)
JEL-codes: D71 D72 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2024-05-15
New Economics Papers: this item is included in nep-des, nep-gth and nep-upt
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Working Paper: Price & Choose (2023)
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