Journal of Economic Perspectives
ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)
Designing Simple Mechanisms
Journal of Economic Perspectives
(pp. 175–92)
(Complimentary)
Abstract
It matters whether real-world mechanisms are simple. If participants cannot see that a mechanism is incentive-compatible, they may refuse to participate or may behave in ways that undermine the mechanism. There are several ways to formalize what it means for a mechanism to be "simple." This essay explains three of them, and suggests directions for future research.Citation
Li, Shengwu. 2024. "Designing Simple Mechanisms." Journal of Economic Perspectives 38 (4): 175–92. DOI: 10.1257/jep.38.4.175Additional Materials
JEL Classification
- D44 Auctions
- D82 Asymmetric and Private Information; Mechanism Design
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness