Journal article

Bayesian Incentive Compatible Parametrization of Mechanisms

We consider a general scheme to construct Bayesian incentive-compatible mechanisms using a suitable ‘variable mechanism parametrization.’ The key idea is to perturb a given direct mechanism, which might not be truth revealing, introducing sufficient variability as a function of agents’ announcements to generate incentives for truthful revelation.We discuss a variable-price auction in a general setting as an example.

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