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A Network Solution to Robust Implementation: The Case of Identical but Unknown Distributions

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  • Mariann Ollár
  • Antonio Penta

Abstract

We study robust mechanism design in environments in which agents commonly believe that others’ types are identically distributed, but we do not assume that the actual distribution is common knowledge, nor that it is known to the designer. First, we characterize all incentive compatible transfers under these assumptions. Second, we characterize the conditions under which full implementation is possible via direct mechanisms, that only elicit payoff relevant information, and the transfer schemes which achieve it whenever possible. The full implementation results obtain from showing that the problem can be transformed into one of designing a network of strategic externalities, subject to suitable constraints which are dictated by the incentive compatibility requirements.

Suggested Citation

  • Mariann Ollár & Antonio Penta, 2023. "A Network Solution to Robust Implementation: The Case of Identical but Unknown Distributions," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(5), pages 2517-2554.
    • Handle: RePEc:oup:restud:v:90:y:2023:i:5:p:2517-2554.
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    File URL: http://hdl.handle.net/10.1093/restud/rdac084
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    References listed on IDEAS

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    1. Philippe Jehiel & Laurent Lamy, 2018. "A Mechanism Design Approach to the Tiebout Hypothesis," Journal of Political Economy, University of Chicago Press, vol. 126(2), pages 735-760.
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    Cited by:

    1. Galeotti, A. & Golub, B. & Goyal, S. & Talamas, E. & Tamuz, O., 2024. "Robust Market Interventions," Janeway Institute Working Papers 2425, Faculty of Economics, University of Cambridge.

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