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Full Access A Characterization for Dominant Strategy Implementation

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A Characterization for Dominant Strategy Implementation

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We introduce a perfect price discriminatingmechanismfor allocation problems with private information. A perfect price discriminating mechanism treats a seller, for example, as a perfect price discriminating monopolist who faces a price schedule that does not depend on her report. In any perfect price discriminating mechanism, every player has a dominant strategy to truthfully report her private information. We establish a characterization for dominant strategy implementation: Any outcome that can be dominant strategy implemented can also be dominant strategy implemented using a perfect price discriminating mechanism. We apply this characterization to derive the optimal, budget-balanced, dominant strategy mechanisms for public good provision and bilateral bargaining.

10.3868/s060-002-013-0001-3
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/content/journals/10.3868/s060-002-013-0001-3
2013-01-01
2016-12-10

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