Neutral Optimum in Private-Values Settings

Tymofiy Mylovanov () and Thomas Tröger ()
Authors registered in the RePEc Author Service: Thomas Troeger

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: We show that in informed-principal settings with generalized private values any neutral optimum (Myerson, 1983) is strongly neologism proof (Mylovanov and Tröger, 2012) and hence is a strong unconstrained Pareto optimum in the setting of Maskin and Tirole (1990). Thus, in any setting with a unique strongly neologism-proof solution this concept is equivalent to neutral optimum. We rely on the unifying concept of neo-optimum that we develop in the companion paper Mylovanov and Tröger (2026). The main step is to prove that any neo-optimum is strongly neologism-proof.

Keywords: informed principal; private values; mechanism design; signaling; neologism (search for similar items in EconPapers)
JEL-codes: C72 D82 (search for similar items in EconPapers)
Pages: 32
Date: 2026-02
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.crctr224.de/research/discussion-papers/archive/dp732 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2025_732

Access Statistics for this paper

More papers in CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany Kaiserstr. 1, 53113 Bonn , Germany.
Bibliographic data for series maintained by CRC Office ().