Minimum cost connection networks: Truth-telling and implementation

• 成果类型: Article
• 署名作者: Hougaard, Jens Leth; Tvede, Mich
• 署名单位: University of Copenhagen; Newcastle University - UK
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2014.12.009
• 发表日期: 2015
• 页码: 76-99
• 关键词: Axiomatic characterization; Connection networks; cost sharing; implementation; Truth-telling

摘要

In the present paper we consider the allocation of costs in connection networks. Agents have connection demands in form of pairs of locations they want to have connected. Connections between locations are costly to build. The problem is to allocate costs of networks satisfying all connection demands. We use a few axioms to characterize allocation rules that truthfully implement cost minimizing networks satisfying all connection demands in a game where: (1) a central planner announces an allocation rule and a cost estimation rule; (2) every agent reports her own connection demand as well as all connection costs; (3) the central planner selects a cost minimizing network satisfying reported connection demands based on the estimated costs; and, (4) the planner allocates the true costs of the selected network. It turns out that an allocation rule satisfies the axioms if and only if relative cost shares are fixed. (C) 2014 Elsevier Inc. All rights reserved.