Browsing by Author "Chen, Yi-Chun"

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    Continuous implementation with direct revelation mechanisms
    (Elsevier, 2022) Chen, Yi-Chun; Mueller-Frank, Manuel; Pai, Mallesh M.
    We investigate how a principal's knowledge of agents' higher-order beliefs impacts their ability to robustly implement a given social choice function. We adapt a formulation of Oury and Tercieux (2012): a social choice function is continuously implementable if it is partially implementable for types in an initial model and “nearby” types. We characterize when a social choice function is truthfully continuously implementable, i.e., using game forms corresponding to direct revelation mechanisms for the initial model. Our characterization hinges on how our formalization of the notion of nearby preserves agents' higher order beliefs. If nearby types have similar higher order beliefs, truthful continuous implementation is roughly equivalent to requiring that the social choice function is implementable in strict equilibrium in the initial model, a very permissive solution concept. If they do not, then our notion is equivalent to requiring that the social choice function is implementable in unique rationalizable strategies in the initial model. Truthful continuous implementation is thus very demanding without non-trivial knowledge of agents' higher order beliefs.
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    Genericity and Robustness of Full Surplus Extraction
    (Wiley, 2013) Chen, Yi-Chun; Xiong, Siyang
    We study whether priors that admit full surplus extraction (FSE) are generic, an issue that becomes a gauge to evaluate the validity of the current mechanism design paradigm. We consider the space of priors on the universal type space, and thereby relax the assumption of a fixed finite number of types made by Crémer and McLean (1988). We show that FSE priors are topologically generic, contrary to the result of Heifetz and Neeman (2006) that FSE is generically impossible, both geometrically and measure-theoretically. Instead of using the BDP approach or convex combinations of priors adopted in Heifetz and Neeman (2006), we prove our genericity results by showing a robustness property of Crémer–McLean mechanisms