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Locally robust implementation and its limits

Author

Listed:
  • Philippe Jehiel

    (PSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, UCL - University College of London [London])

  • Moritz Meyer-Ter-Vehnc

    (UCLA - University of California [Los Angeles] - UC - University of California)

  • Benny Moldovanu

    (Universität Bonn = University of Bonn)

Abstract

We study a notion of locally robust implementation that captures the idea that the planner may know agents' beliefs well, but not perfectly. Locally robust implementation is a weaker concept than ex-post implementation, but we show that no regular allocation function is locally robust implementable in generic settings with quasi-linear utility, interdependent and bilinear values, and multi-dimensional payoff types.

Suggested Citation

  • Philippe Jehiel & Moritz Meyer-Ter-Vehnc & Benny Moldovanu, 2012. "Locally robust implementation and its limits," Post-Print hal-00813046, HAL.
    • Handle: RePEc:hal:journl:hal-00813046
    DOI: 10.1016/j.jet.2012.05.012
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    References listed on IDEAS

    as
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    3. Moritz Meyer-ter-Vehn & Stephen Morris, 2012. "The Robustness of Robust Implementation," World Scientific Book Chapters, in: Robust Mechanism Design The Role of Private Information and Higher Order Beliefs, chapter 10, pages 357-373, World Scientific Publishing Co. Pte. Ltd..
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    Cited by:

    1. Chen, Yi-Chun & Kunimoto, Takashi & Sun, Yifei, 2023. "Continuous implementation with payoff knowledge," Journal of Economic Theory, Elsevier, vol. 209(C).
    2. Dirk Bergemann & Stephen Morris & Satoru Takahashi, 2012. "Efficient Auctions and Interdependent Types," American Economic Review, American Economic Association, vol. 102(3), pages 319-324, May.
    3. Chen, Yi-Chun & Mueller-Frank, Manuel & Pai, Mallesh M., 2022. "Continuous implementation with direct revelation mechanisms," Journal of Economic Theory, Elsevier, vol. 201(C).
    4. Giuseppe Lopomo & Luca Rigotti & Chris Shannon, 2021. "Uncertainty in Mechanism Design," Papers 2108.12633, arXiv.org.
    5. Modibo Camara & Jason Hartline & Aleck Johnsen, 2020. "Mechanisms for a No-Regret Agent: Beyond the Common Prior," Papers 2009.05518, arXiv.org.
    6. Jain, Ritesh & Lombardi, Michele, 2022. "Continuous virtual implementation: Complete information," Journal of Mathematical Economics, Elsevier, vol. 99(C).
    7. Lopomo, Giuseppe & Rigotti, Luca & Shannon, Chris, 2022. "Uncertainty and robustness of surplus extraction," Journal of Economic Theory, Elsevier, vol. 199(C).
    8. Pham, Hien & Yamashita, Takuro, 2024. "Auction design with heterogeneous priors," Games and Economic Behavior, Elsevier, vol. 145(C), pages 413-425.
    9. de Clippel, Geoffroy & Saran, Rene & Serrano, Roberto, 2023. "Continuous level-k mechanism design," Games and Economic Behavior, Elsevier, vol. 140(C), pages 481-501.
    10. Ollar, Mariann & Penta, Antonio, 2024. "Incentive Compatibility and Belief Restrictions," TSE Working Papers 24-1558, Toulouse School of Economics (TSE).
    11. Geoffroy de Clippel & Rene Saran & Roberto Serrano, 2014. "Mechanism Design with Bounded Depth of Reasoning and Small Modeling Mistakes," Working Papers 2014-7, Brown University, Department of Economics.
    12. Carroll, Gabriel & Meng, Delong, 2016. "Locally robust contracts for moral hazard," Journal of Mathematical Economics, Elsevier, vol. 62(C), pages 36-51.

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    More about this item

    Keywords

    Robust implementation; Interdependent values; Multi-dimensional types; Perturbed beliefs;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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