Manipulation via Endowments in Exchange Markets with Indivisible Goods

Murat Atlamaz and Bettina Klaus ()

UFAE and IAE Working Papers from Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC)

Abstract: We consider exchange markets with heterogeneous indivisible goods. We are interested in exchange rules that are efficient and immune to manipulations via endowments (either with respect to hiding or destroying part of the endowment or transferring part of the endowment to another trader). We consider three manipulability axioms: hiding-proofness, destruction-proofness, and transfer-proofness. We prove that no rule satisfying efficiency and hiding-proofness (which implies individual rationality) exists. For two-agent exchange markets with separable and responsive preferences, we show that efficient, individually rational, and destruction-proof rules exist. However, for separable preferences, no rule satisfies efficiency, individual rationality, and destruction-proofness. In the case of transfer-proofness the compatibility with efficiency and individual rationality for the two-agent case extends to the unrestricted domain. For exchange markets with separable preferences and more than two agents no rule satisfies efficiency, individual rationality, and transfer-proofness.

Keywords: Hiding-proofness; destruction-proofness; transfer-proofness; exchange markets with heterogeneous indivisible objects. (search for similar items in EconPapers)
JEL-codes: D71 (search for similar items in EconPapers)
Pages: 16
Date: 2003-12-01
New Economics Papers: this item is included in nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Manipulation via Endowments in Exchange Markets with Indivisible Goods (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:aub:autbar:598.04

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