Distributing Awards Efficiently: More on King Solomon's Problem
View / Open Files
Authors
Bag, Parimal Kanti
Sabourian, Hamid
Publication Date
2004-06-16Series
Cambridge Working Papers in Economics
Publisher
Faculty of Economics
Language
en_GB
Type
Working Paper
Metadata
Show full item recordCitation
Bag, P. K., & Sabourian, H. (2004). Distributing Awards Efficiently: More on King Solomon's Problem. https://doi.org/10.17863/CAM.4989
Abstract
We consider a multi-award generalisation of King Solomon's problem: k identical and indivisible awards should be distributed among agents, k < n, with the top k valuation agents receiving the awards. Agents have complete information about each other's valuations. Glazer and Ma (1989) analysed the single-prize (i.e. k = 1) version of this problem. We show that in the more than two agents problem the mechanism of Glazer and Ma admits inefficient equilibria and thus fails to solve Solomon's problem. So, first we modify their mechanism to rule out inefficient equilibria and implement efficient prize allocation in sub-game perfect equilibrium when there are at least three agents. Then it is shown that a simple repeated application of our modified mechanism will distribute k (>1) prizes efficiently in sub-game perfect equilibria without any monetary transfers in equilibrium. Finally, in the multi-awards case we relax the complete information assumption and achieve implementation of efficient allocation by iterative elimination of weakly dominated strategies, using generalisation of Olszewski's (2003) mechanism.
Keywords
Classification-JEL: D78, Solomon's problem, prizes, implementation
Identifiers
This record's DOI: https://doi.org/10.17863/CAM.4989
Statistics
Total file downloads (since January 2020). For more information on metrics see the
IRUS guide.
Recommended or similar items
The current recommendation prototype on the Apollo Repository will be turned off on 03 February 2023. Although the pilot has been fruitful for both parties, the service provider IKVA is focusing on horizon scanning products and so the recommender service can no longer be supported. We recognise the importance of recommender services in supporting research discovery and are evaluating offerings from other service providers. If you would like to offer feedback on this decision please contact us on: support@repository.cam.ac.uk