First best implementation with costly information acquisition

Daniil Larionov, Hien Pham, Takuro Yamashita and Shuguang Zhu

No 22-064, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: We study mechanism design with flexible but costly information acquisition. There is a principal and four or more agents, sharing a common prior over the set of payoff-relevant states. The principal proposes a mechanism to the agents who can then acquire information about the state of the world by privately designing a signal device. As long as it is costless for each agent to acquire a signal that is independent from the state, we show that there exists a mechanism which allows the principal to implement any social choice rule at zero information acquisition cost to the agents.

Date: 2022
New Economics Papers: this item is included in nep-des and nep-mic
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Working Paper: First Best Implementation With Costly Information Acquisition (2022)
Working Paper: First Best Implementation with Costly Information Acquisition (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:22064

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