Strategic Manipulations and Collusions in Knaster Procedure

Vito Fragnelli (vito.fragnelli@mfn.unipmn.it) and Maria Erminia Marina (marina@economia.unige.it)
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Maria Erminia Marina: University of Genova, Department of Economics and Quantitative Methods, Genova, Italy, http://www.unige.it/

Czech Economic Review, 2009, vol. 3, issue 2, 143-153

Abstract: The Knaster’s procedure is one of the simplest and most powerful mechanisms for allocating indivisible objects among agents requiring them, but its sealed bid feature may induce some agents in altering their valuations. In this paper we study the consequences of false declarations on the agents’ payoffs. A misrepresentation of a single agent could produce a gain or a loss. So, we analyze a possible behavior of a subset of infinitely risk-averse agents and propose how to obtain a safe gain via a joint misreporting of their valuations, regardless of the declarations of the other agents.

Keywords: Knaster’s procedure; misrepresentation; collusion (search for similar items in EconPapers)
JEL-codes: C70 (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (4)

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