MICRO/THEORY: Interim Strategy-proof Mechanisms; Dr Qinggong Wu (Hong Kong University of Science and Technology)

Abstract

In this paper, we examine mechanism design under the criterion of interim strategy-proofness (ISP), which extends the concept of strategy-proofness to settings with interdependent values. ISP stipulates that for each agent, given her beliefs about the types of other agents, truthful reporting is always the optimal strategy, regardless of the strategies employed by others. An ISP mechanism is resilient to strategic ignorance among agents and also robust against informational ignorance regarding higher-order beliefs. In a binary voting model, we characterize the set of all ISP mechanisms and demonstrate that the flexibility of ISP mechanism design is constrained by the degree of preference interdependence in the environment. Additionally, we identify a class of mechanisms that are ISP across all environments.