Deterministic Implementation of Mean-Preserving Contractions

Junze Sun

Papers from arXiv.org

Abstract: We study whether randomization is needed to generate a prescribed distribution of posterior means for a one-dimensional state. Drawing on backward Monge martingale transport, we show that every mean-preserving contraction of an atomless prior with finite first moment admits a deterministic implementation. Consequently, restricting attention to deterministic signals leaves the designer's value unchanged whenever objectives and constraints depend only on the posterior-mean distribution. We decompose implementation into independent problems on non-separating intervals and describe a constructive procedure based on barcode transport. We also characterize when lower or upper contour sets can take a nested-interval form, and provide applications to monopolistic pricing with buyer-optimal learning and robust persuasion with ambiguous receiver preferences.

Date: 2026-10
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