Identical Preferences Lower Bound for Allocation of Heterogenous Tasks and NIMBY Problems


  • I thank William Thomson for his guidance and advice and Herve Moulin for his suggestions. This paper is the first part of an earlier working paper entitled “Groves Mechanisms and Welfare Bounds in a Variable Population Setting.” (See Yengin, 2012c, for the second part.)


We study the allocation of collectively owned indivisible goods when monetary transfers are possible. We restrict our attention to incentive-compatible mechanisms which allocate the goods efficiently. Among these mechanisms, we characterize those that respect the identical preferences lower bound: each agent should be at least as well off as in a hypothetical economy where all agents have the same preference as hers, no agent envies another, and the budget is balanced.