original papers: On efficient trading mechanisms between one seller and n buyers

Domenico Menicucci

Review of Economic Design, 2000, vol. 5, issue 1, 59-70

Abstract: Myerson and Satterthwaite (1983) prove that if one seller and one buyer have independent private valuations for an indivisible object then no individually rational and incentive compatible trading mechanism can guarantee ex post efficiency when gains from trade are uncertain. Makowski and Mezzetti (1993) show that this is not the case when there are at least two buyers. In the latter context, if the highest possible seller's valuation is not too large, we provide an ex post efficient mechanism in which the mechanism designer and the agents are not required to know the probability distribution for the seller's valuation.

Keywords: Incomplete information; mechanism design; efficient mechanisms; first price auctions (search for similar items in EconPapers)
JEL-codes: C72 D70 D82 (search for similar items in EconPapers)
Date: 2000-04-18
Note: Received: February 18, 1998 / Accepted: September 10, 1999
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