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UCL Department of Economics

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Theory Seminar Online presented by Shengwu Li (Harvard)

17 November 2020, 4:30 pm–5:45 pm

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"Investment Incentives in Near-Optimal Mechanisms" joint with Mohammed Akbarpour, Scott Duke Kominers, and Paul Milgrom

Event Information

Open to

All

Organiser

Konrad Mierendorff, Deniz Kattwinkel

Location

LG10
056: Bentham House
4-8 Endsleigh Gardens
London
WC1H 0EG
United Kingdom

Abstract: In a Vickrey auction, if one bidder can invest to increase his value, the combined mechanism including investments is still fully optimal. By contrast, there exist monotone allocation rules that are arbitrarily close to the the allocative optimum, but such that the associated mechanism with investments by one bidder cannot guarantee any positive fraction of the full optimum. We show that if a monotone allocation rule that guarantees some fraction of the allocative optimum also “excludes bossy negative externalities,” then the same guarantee applies to the combined mechanism with investments. We show moreover that a mild weakening of this property is necessary and sufficient for the result.

Zoom Meeting ID: 991 0547 9347
Password: 710650

 

 

About the Speaker

Shengwu Li

at Harvard

More about Shengwu Li