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Continuous Implementation with Local Payoff Uncertainty

Oury, Marion (2015), Continuous Implementation with Local Payoff Uncertainty, Journal of Economic Theory, 158, Part A, p. 656-677. 10.1016/j.jet.2015.07.007

Type
Article accepté pour publication ou publié
Date
2015
Journal name
Journal of Economic Theory
Volume
158
Number
Part A
Publisher
Elsevier
Pages
656-677
Publication identifier
10.1016/j.jet.2015.07.007
Metadata
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Author(s)
Oury, Marion
Laboratoire d'Economie de Dauphine [LEDa]
Abstract (EN)
Following the notion of continuous implementation, we consider a situation where the social planner is not entirely sure of the validity of his model and thus wants the social choice function to be not only (partially) implemented at all types of the initial model, but also at all types “close” to those types. In addition, we assume that the social planner also has some doubts on the payoffs of the outcomes and thus wants his prediction to be robust when these payoffs are close but not exactly equal to those in the initial model. Under this local payoff uncertainty, the present paper establishes the following full characterization result for finite mechanisms: a social choice function is continuously implementable if and only if it is fully implementable in rationalizable strategies.
Subjects / Keywords
High order beliefs; Robust implementation
JEL
D82 - Asymmetric and Private Information; Mechanism Design
C79 - Other

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