Secure Implementation

Tatsuyoshi Saijo (), Tomas Sjostrom and Takehiko Yamato ()
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Takehiko Yamato: Department of Values and Decision Science, Tokyo Institute of Technology

No 56, Economics Working Papers from Institute for Advanced Study, School of Social Science

Abstract: Strategy-proofness, requiring that truth-telling is a dominant strategy, is a standard concept in social choice theory. However, this concept has serious drawbacks. In particular, many strategy-proof mechanisms have multiple Nash equilibria, some of which produce the wrong outcome. A possible solution to this problem is to require double implementation in Nash equilibrium and in dominant strategies, i.e., secure implementation. We characterize securely implementable social choice functions, and compare our results with dominant strategy implementation. In standard quasi-linear environments with divisible private or public goods, there exist Pareto efficient (non-dictatorial) social choice functions that can be securely implemented. But in the absence of side-payments, secure implementation is incompatible with Pareto efficiency.

JEL-codes: C92 D71 D78 H41 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2005-07
New Economics Papers: this item is included in nep-cdm, nep-gth and nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Journal Article: Secure implementation (2007)
Working Paper: Secure Implementation (2004)
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