Information requirements for mechanism design

Richard P. McLean and Andrew Postlewaite

Journal of Economic Theory, 2025, vol. 228, issue C

Abstract: Standard mechanism design begins with a statement of the problem, including knowledge on the designer's part about the distribution of the characteristics (preferences and information) of the participants who are to engage with the mechanism. There is a large literature on robust mechanism design, much of which aims to reduce the assumed information the designer has about the participants. In this paper we provide an auction mechanism for interdependent value problems that performs well when there are many buyers, even though there is no prior distribution over the accuracy of buyers' information on the part of the designer or the participants.

Keywords: Robustness; Optimal auctions; Incentive compatibility; Mechanism design; Interdependent values; Informational size; Common knowledge (search for similar items in EconPapers)
JEL-codes: C70 D44 D60 D82 (search for similar items in EconPapers)
Date: 2025
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Working Paper: Information Requirements for Mechanism Design (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:228:y:2025:i:c:s0022053125001024

DOI: 10.1016/j.jet.2025.106056

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