 Selling mechanisms for a financially constrained buyerJuan Carlos Carbajal and Ahuva Mu'alem Games and Economic Behavior, 2020, vol. 124, issue C, 386-405 Abstract: We study implementability and revenue equivalence for selling mechanisms in a model where a seller has multiple items to allocate, and a buyer has private valuations and private budgets. We provide necessary and sufficient conditions for selling mechanisms to be incentive compatible and ex-post budget feasible for the buyer and derive the revenue equivalence principle in the presence of private budgets. Our conditions are based on a novel network approach that exploits the difference between unrestricted incremental values —the minimal value difference between an item assigned to the buyer by the seller and another alternative— and restricted incremental values —the minimal value difference between the assigned item and the alternative when the buyer can actually afford the alternative, given her financial disposition. We derive properties of incentive compatible, budget feasible prices, and illustrate our approach in a multi-item allocation problem with a convex type space. Keywords: Incentive compatibility; Private budgets; Revenue equivalence; Incremental values; Allocation networks; Multi-item allocation problems (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:124:y:2020:i:c:p:386-405 DOI: 10.1016/j.geb.2020.08.014 Access Statistics for this article Games and Economic Behavior is currently edited by E. Kalai More articles in Games and Economic Behavior from Elsevier |
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