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Efficient Trading Mechanisms with Pre-play Communication

Srivastava, Sanjay and Palfrey, Thomas R. (1991) Efficient Trading Mechanisms with Pre-play Communication. Journal of Economic Theory, 55 (1). p. 17. ISSN 0022-0531. doi:10.1016/0022-0531(91)90057-B.

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This paper studies the problem of designing efficient trading mechanisms that are immune to pre-play communication. It is well known that equilibrium behavior can be affected, sometimes drastically, if players have the opportunity to exchange messages prior to playing some particular game. We investigate the relationship between efficiency, pre-play communication, and unique implementation in Bayesian environments with independent types and private values. We identify a class of simple mechanisms which are immune to pre-play communication and show that any incentive efficient allocation can be uniquely implemented by such a mechanism.

Item Type:Article
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URLURL TypeDescription ItemSSWP 693
Palfrey, Thomas R.0000-0003-0769-8109
Additional Information:© 1991 Elsevier. Received February 13, 1990; revised November 21, 1990. We acknowledge financial support from the National Science Foundation. We thank, without implicating, Andrew Postlewaite, Mark Satterthwaite, seminar participants at The University of Aix-Marseille, Barcelona, Caltech, CORE, Ecole Polytechnique, The University of Toulouse, The University of Western Ontario, participants of the 1989 NBER Conference on Decentralization, and the referees, for helpful comments. Published paper for internal review only. Formerly SSWP 693.
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Social Science Working Paper693
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Record Number:CaltechAUTHORS:20160307-140227182
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Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:65135
Deposited On:01 Apr 2016 23:28
Last Modified:10 Nov 2021 23:40

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