Efficient investments in the implementation problem

• 成果类型: Article
• 署名作者: Tomoeda, Kentaro
• 署名单位: University of Technology Sydney
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2019.04.009
• 发表日期: 2019
• 页码: 247-278
• 关键词: Investment efficiency; full implementation; mechanism design; Ex ante investment; Ex post investment

摘要

This paper identifies a condition for an efficient social choice rule to be fully implementable when we take into account investment efficiency. To do so, we extend the standard implementation problem to include endogenous ex ante and ex post investments. In our problem, the social planner aims to achieve efficiency in every equilibrium of a dynamic game in which agents strategically make investments before and after playing the mechanism. Our main theorem shows that a novel condition commitment-proofness is sufficient and necessary for an efficient social choice rule to be implementable in subgame-perfect equilibria. The availability of ex post investments is crucial in our model: there is no social choice rule that is efficient and implementable in subgame-perfect equilibria without ex post investments. We also show that our positive result continues to hold in the incomplete information setting. (C) 2019 Elsevier Inc. All rights reserved.