Journal Of The Econometric Society

An International Society for the Advancement of Economic
Theory in its Relation to Statistics and Mathematics

Edited by: Guido W. Imbens • Print ISSN: 0012-9682 • Online ISSN: 1468-0262

Econometrica: Sep, 2004, Volume 72, Issue 5

Mechanism Design with Interdependent Valuations: Efficiency
p. 1617-1626

Claudio Mezzetti

Agents' valuations are interdependent if they depend on the signals, or types, of all agents. Under the implicit assumption that agents cannot observe their outcome‐decision payoffs, previous literature has shown that with interdependent valuations and independent signals, efficient design is impossible. This paper shows that an efficient mechanism exists in an environment where first the final outcome (e.g., allocation of the goods) is determined, then the agents observe their own outcome‐decision payoffs, and then final transfers are made.

Log In To View Full Content