Conservative Rationalizability and The Second-Knowledge Mechanism
In mechanism design, the traditional way of modeling the players' incomplete information about their opponents is "assuming a Bayesian." This assumption, however, is very strong and does not hold in many real applications. Accordingly, we put forward (1) a set-theoretic way to model t...
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2010
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| Online Access: | http://hdl.handle.net/1721.1/60371 |
| _version_ | 1826198392002314240 |
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| author | Chen, Jing Micali, Silvio |
| author2 | Silvio Micali |
| author_facet | Silvio Micali Chen, Jing Micali, Silvio |
| author_sort | Chen, Jing |
| collection | MIT |
| description | In mechanism design, the traditional way of modeling the players' incomplete information about their opponents is "assuming a Bayesian." This assumption, however, is very strong and does not hold in many real applications. Accordingly, we put forward (1) a set-theoretic way to model the knowledge that a player might have about his opponents, and (2) a new class of mechanisms capable of leveraging such more conservative knowledge in a robust way. In auctions of a single good, we show that such a new mechanism can perfectly guarantee a revenue benchmark (always lying in between the second highest and the highest valuation) that no classical mechanism can even approximate in any robust way. |
| first_indexed | 2024-09-23T11:04:09Z |
| id | mit-1721.1/60371 |
| institution | Massachusetts Institute of Technology |
| last_indexed | 2024-09-23T11:04:09Z |
| publishDate | 2010 |
| record_format | dspace |
| spelling | mit-1721.1/603712019-04-10T12:58:10Z Conservative Rationalizability and The Second-Knowledge Mechanism Chen, Jing Micali, Silvio Silvio Micali Theory of Computation In mechanism design, the traditional way of modeling the players' incomplete information about their opponents is "assuming a Bayesian." This assumption, however, is very strong and does not hold in many real applications. Accordingly, we put forward (1) a set-theoretic way to model the knowledge that a player might have about his opponents, and (2) a new class of mechanisms capable of leveraging such more conservative knowledge in a robust way. In auctions of a single good, we show that such a new mechanism can perfectly guarantee a revenue benchmark (always lying in between the second highest and the highest valuation) that no classical mechanism can even approximate in any robust way. 2010-12-30T09:30:03Z 2010-12-30T09:30:03Z 2010-12-20 http://hdl.handle.net/1721.1/60371 MIT-CSAIL-TR-2010-060 23 p. application/pdf |
| spellingShingle | Chen, Jing Micali, Silvio Conservative Rationalizability and The Second-Knowledge Mechanism |
| title | Conservative Rationalizability and The Second-Knowledge Mechanism |
| title_full | Conservative Rationalizability and The Second-Knowledge Mechanism |
| title_fullStr | Conservative Rationalizability and The Second-Knowledge Mechanism |
| title_full_unstemmed | Conservative Rationalizability and The Second-Knowledge Mechanism |
| title_short | Conservative Rationalizability and The Second-Knowledge Mechanism |
| title_sort | conservative rationalizability and the second knowledge mechanism |
| url | http://hdl.handle.net/1721.1/60371 |
| work_keys_str_mv | AT chenjing conservativerationalizabilityandthesecondknowledgemechanism AT micalisilvio conservativerationalizabilityandthesecondknowledgemechanism |