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Strategically Simple Mechanisms

Tilman Börgers () and Jiangtao Li

No 6844, CESifo Working Paper Series from CESifo Group Munich

Abstract: We define and investigate a property of mechanisms that we call “strategic simplicity,” and that is meant to capture the idea that, in strategically simple mechanisms, strategic choices are easy. We define a mechanism to be strategically simple if strategic choices can be based on first-order beliefs about the other agents’ preferences alone, and there is no need for agents to form higher-order beliefs, because such beliefs are irrelevant to agents’ optimal choices. All dominant strategy mechanisms are strategically simple. But many more mechanisms are strategically simple. In particular, strategically simple mechanisms may be more flexible than dominant strategy mechanisms in the voting problem and the bilateral trade problem..

JEL-codes: D82 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-des, nep-gth and nep-mic
Date: 2018
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