
A solution to the two-person implementation problem
Laslier, Jean-François; Nunez, Matias; Sanver, Remzi (2020), A solution to the two-person implementation problem, Journal of Economic Theory, 194, p. 105261. 10.1016/j.jet.2021.105261
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Article accepté pour publication ou publiéDate
2020Journal name
Journal of Economic TheoryVolume
194Publisher
Elsevier
Pages
105261
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Show full item recordAbstract (EN)
We propose strike mechanisms as a solution to the classical problem of Hurwicz and Schmeidler (1978) and Maskin (1999) according to which, in two-person societies, no Pareto efficient rule is Nash-implementable. A strike mechanism specifies the number of alternatives that each player vetoes. Each player simultaneously casts these vetoes and the mechanism selects randomly one alternative among the non-vetoed ones. For strict preferences over alternatives and under a very weak condition for extending preferences over lotteries, these mechanisms are deterministic-in-equilibrium. They Nash implement a class of Pareto efficient social choice rules called Pareto-and-veto rules. Moreover, under mild richness conditions on the domain of preferences over lotteries, any Pareto efficient Nash-implementable rule is a Pareto-and-veto rule and hence is implementable through a strike mechanism.Subjects / Keywords
Pareto efficiency; Two players; Nash implementationRelated items
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