Designing Economic Mechanisms [Hardcover]

Leonid Hurwicz (Author), Stanley Reiter (Author)

Book Description

ISBN-10: 0521836417 | ISBN-13: 978-0521836418 | Publication Date: May 22, 2006

A mechanism is a mathematical structure that models institutions through which economic activity is guided and coordinated. There are many such institutions; markets are the most familiar ones. Lawmakers, administrators and officers of private companies create institutions in orders to achieve desired goals. They seek to do so in ways that economize on the resources needed to operate the institutions, and that provide incentives that induce the required behaviors. This book presents systematic procedures for designing mechanisms that achieve specified performance, and economize on the resources required to operate the mechanism, i.e., informationally efficient mechanisms. Our systematic design procedures are algorithms for designing informationally efficient mechanisms. Most of the book deals with these procedures of design. When there are finitely many environments to be dealt with, and there is a Nash-implementing mechanism, our algorithms can be used to make that mechanism into an informationally efficient one. Informationally efficient dominant strategy implementation is also studied.

Editorial Reviews

Review

"This book's innovative techniques can be useful for finding feasible solutions in both theoretical and applied statistical multivariable optimization problems." - Stan Lipovetsky, Technometrics

"Economic mechanism design has both theoretical and practical importance. This book, by two founders of the field, provides a wonderful guide for those who would design mechanisms. It is a major achievement, providing deep insights based on the authors' experience and wisdom. It should be required reading for all." - John Ledyard, California Institute of Technology

"This book shows how a mechanism designer, given the organization's goal, can construct a decentralized mechanism, wherein no agent directly reveals private information and yet, through message exchanges that are minimal (in an appropriate sense), enough information is gathered so that goal-fulfilling actions can be taken." - Thomas A. Marschak, University of California, Berkeley

"In this masterly and important book, Leonid Hurwicz, the founder of the theory of mechanism design, and Stanley Reiter, a leading pioneer in the field, consolidate their long-standing collaboration on how to design mechanisms that achieve society's allocational goals." - Eric Maskin, Nobel Laureate, Princeton University

"The introduction to economic theory of mechanism design, the formal analysis of economic institutions, is one of the most important developments in economics in the last half century. This book both describes and extends the state of understanding in a large and important segment of mechanism design and will define the frontier of the area for some time to come." - Andrew Postlewaite, University of Pennsylvania

Book Description

This book presents methods for designing institutions that direct and coordinate economic activity to achieve specified goals. These methods design informationally efficient mechanisms; they can also be used to modify mechanisms that induce strategic behavior to achieve specified goals such that the modified mechanism retains the incentive properties of the original and is informationally efficient.

See all Editorial Reviews

Product Details

• Hardcover: 354 pages
• Publisher: Cambridge University Press (May 22, 2006)
• Language: English
• ISBN-10: 0521836417
• ISBN-13: 978-0521836418
• Product Dimensions: 6.2 x 9.2 x 1 inches
• Shipping Weight: 1.3 pounds (View shipping rates and policies)
• Amazon Best Sellers Rank: #2,192,165 in Books (See Top 100 in Books)

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