Informational smallness and the scope for limiting information rents
Journal
Journal of Economic Theory
ISSN
0022-0531
ISSN-Digital
1095-7235
Type
journal article
Date Issued
2010-07-15
Author(s)
Abstract
For an incomplete-information model of public-good provision with interim participation constraints, we show that efficient outcomes can be approximated, with approximately full surplus extraction, when there are many agents and each agent is informationally small. The result holds even if agents' payoffs cannot be unambiguously inferred from their beliefs. The contrary result of Neeman [Z. Neeman, The relevance of private information in mechanism design, J. Econ. Theory 117 (2004) 55-77] rests on an implicit uniformity requirement that is incompatible with the notion that agents are informationally small because there are many other agents who have information about them.
Language
English
Keywords
Surplus extraction
Mechanism design
BDP
Informational smallness
Correlated information
Universal type space
Public goods
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Elsevier
Publisher place
Amsterdam
Volume
145
Number
6
Start page
2260
End page
2281
Pages
22
Subject(s)
Eprints ID
243439