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The ex ante incentive compatible core in the absence of wealth effects

Forges, Françoise; Mertens, Jean-François; Vohra, Rajiv (2002), The ex ante incentive compatible core in the absence of wealth effects, Econometrica, 70, 5, p. 1865–1892. http://dx.doi.org/10.1111/1468-0262.00356

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Type
Article accepté pour publication ou publié
Date
2002
Journal name
Econometrica
Volume
70
Number
5
Publisher
Wiley
Pages
1865–1892
Publication identifier
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Author(s)
Forges, Françoise
Mertens, Jean-François
Vohra, Rajiv
Abstract (EN)
In a differential information economy with quasi–linear utilities, monetary transfers facilitate the fulfillment of incentive compatibility constraints : the associated ex ante core is generically nonempty. However, we exhibit a well–behaved exchange economy in which this core is empty, even if goods are allocated through random mechanisms.
Subjects / Keywords
Exchange economy; Core; quasi–linear; absence of wealth effects; transferable utility; ex ante; incentive compatibility; asymmetric information
JEL
D51 - Exchange and Production Economies
D82 - Asymmetric and Private Information; Mechanism Design