Suchergebnisse

What are good voting rules if voting is costly? We analyze this question for the case that an electorate chooses among two alternatives. In a symmetric private value model of voting we show that majority voting with voluntary participation Pareto-dominates majority voting with compulsory participation as well as random decision-making.

For a mechanism designer with an objective such as welfare we propose a method for robustly ranking mechanisms. The method is based on eliminating weakly dominated strategies only, and thus does not require any assumptions about agents' beliefs about each other except full support. We illustrate the usefulness of this method in two examples: bilateral trading and voting. In both examples we show that there are mechanisms that are ranked by our method above dominant strategy mechanisms. These examples question the literature's focus on dominant strategy mechanisms in cases when such mechanisms yield undesirable outcomes.

The paper studies the concept of ``ex post equilibrium" that has recently become popular in literature on auctions, mechanism design and implementation. We ask how one should define ex post equilibrium if one wants to consider extensive games, such as dynamic auctions, and if one wants to include sequential rationality in the equilibrium definition. As it turns out, this raises some conceptual questions that are not present in the static setting. We are lead to introduce three different definitions - all variations of what we call ``information-invariant equilibrium." One of these three definitions is equivalent to ``ex post equilibrium." In static games the three definitions coincide. In extensive games they do not - if we impose sequential rationality. Our main purpose is to make a methodological contribution to game theory, but we illustrate the relevance of this contribution by applying our concepts to several auction games.