Foundations and Trends® in Microeconomics > Vol 8 > Issue 3

An Introduction to Robust Mechanism Design

  • Bergemann, Dirk 1
  • Morris, Stephen 2

[1]Bergemann, Dirk, Department of Economics, Yale University, USA, dirk.bergemann@yale.edu [2]Morris, Stephen, Department of Economics, Princeton University, USA, smorris@princeton.edu

Published: 22 February 2013 © 2013 D. Bergemann and S. Morris

Short description

An Introduction to Robust Mechanism Design brings together and presents a number of results on the theme of robust mechanism design and robust implementation that the authors have been working on in the past decade. This work examines the implications of relaxing the strong informational assumptions that drive much of the mechanism design literature.

Keywords

Industrial Organization | Economic Theory

C79 Game Theory and Bargaining Theory, D82 Mechanism Design

Mechanism Design, Robust Mechanism Design, Common Knowledge, Universal Type Space, Interim Equilibrium, Ex Post Equilibrium, Dominant Strategies, Rationalizability, Partial Implementation, Full Implementation, Robust Implementation

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Table of contents

1 Introduction
2 Leading Example: Allocating a Private Good with Interdependent Values
3 Type Spaces
4 Robust Foundations for Dominant and Ex Post Incentive Compatibility
5 Full Implementation
6 Open Issues
References

Foundations and Trends® in Microeconomics

(Vol 8, Issue 3, 2012, pp 169-230)

DOI: 10.1561/0700000057

Abstract

This essay provides an introduction to our recent work on robust mechanism design. The objective is to provide an overview of the research agenda and its results. We present the main results and illustrate many of them in terms of a common and canonical example, the single unit auction with interdependent values. In addition, we provide an extended discussion about the role of alternative assumptions about type spaces in our work, and the literature at large, in order to explain the common logic of the informational robustness approach that unifies the work.

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Table of contents

Introduction
Leading Example: Allocating a Private Good with Interdependent Values
Type Spaces
Robust Foundations for Dominant and Ex Post Incentive Compatibility
Full Implementation
Open Issues
References
Cover image for An Introduction into Robust Mechanism Design

An Introduction into Robust Mechanism Design

61 pages

DOI: 10.1561/9781601986450

E-ISBN: 978-1-60198-645-0

ISBN: 978-1-60198-644-3

Description

An Introduction to Robust Mechanism Design brings together and presents a number of results on the theme of robust mechanism design and robust implementation that the authors have been working on in the past decade. This work examines the implications of relaxing the strong informational assumptions that drive much of the mechanism design literature. The objective is to provide the reader with an overview of the research agenda and present the main results of this research by illustrating it in terms of a common and canonical example – the single unit auction with interdependent values. In addition, the monograph includes an extended discussion on the role of alternative assumptions about type spaces in the authors' work. It also discusses the literature to explain the common logic of the informational robustness approach that unifies the work that is surveyed in this monograph.