Natural implementation with partially-honest agents in economic environments with free-disposal

Michele Lombardi and Naoki Yoshihara ()

No 2014-09, UMASS Amherst Economics Working Papers from University of Massachusetts Amherst, Department of Economics

Abstract: We study Nash implementation by natural price-quantity mechanisms in pure exchange economies with free-disposal (Saijo et al., 1996, 1999) where agents have weak/strong intrinsic preferences for honesty (Dutta and Sen, 2012). Firstly, the Walrasian rule is shown to be non-implementable where all agents have weak (but not strong) intrinsic preferences for honesty. Secondly, the class of efficient allocation rules that are implementable is identified provided that at least one agent has strong intrinsic preferences for honesty. Lastly, the Walrasian rule is shown to belong to that class.

Keywords: Natural implementation; Nash equilibrium; exchange economies; intrinsic preferences for honesty. (search for similar items in EconPapers)
JEL-codes: C72 D71 (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-gth and nep-mic
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Citations: View citations in EconPapers (4)

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Related works:
Working Paper: Natural implementation with partially-honest agents in economic environments with free-disposal (2015)
Working Paper: Natural Implementation with Partially-honest Agents in Economic Environments with Free-disposal (2014)
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