We are very grateful to Martín Besfamille, Roberto Burguet, Hector Chade, Estelle Cantillon, Giuseppe Lopomo, Jeroen Swinkels, and Lin Zhou for comments on an earlier draft.
Bayesian and Dominant-Strategy Implementation in the Independent Private-Values Model
Article first published online: 3 DEC 2010
© 2010 The Econometric Society
Volume 78, Issue 6, pages 1905–1938, November 2010
How to Cite
Manelli, A. M. and Vincent, D. R. (2010), Bayesian and Dominant-Strategy Implementation in the Independent Private-Values Model. Econometrica, 78: 1905–1938. doi: 10.3982/ECTA8025
- Issue published online: 3 DEC 2010
- Article first published online: 3 DEC 2010
- Manuscript received July, 2008; final revision received May, 2010.
- Independent private values;
- incentive compatibility;
- Bayesian implementations;
- dominant-strategy implementation;
- adverse selection;
- bilateral trade;
- mechanism design
We prove—in the standard independent private-values model—that the outcome, in terms of interim expected probabilities of trade and interim expected transfers, of any Bayesian mechanism can also be obtained with a dominant-strategy mechanism.