Welfare-maximizing assignment of agents to hierarchical positions
Hafalir, Isa (Carnegie Mellon University)
Miralles, Antonio (Miralles Asensio) (Universitat Autònoma de Barcelona)

Date:	2015
Abstract:	We allocate agents to three kinds of hierarchical positions: top, medium, and low. No monetary transfers are allowed. We solve for the incentive-compatible (IC) mechanisms that maximize a family of weighted social welfares that includes utilitarian and Rawlsian welfares. When the market is tough (all agents bear positive risk of obtaining a low position in any IC and feasible mechanism), then the pseudomarket mechanism with equal budgets (PM) and the Boston mechanism without priorities (BM) yield identical assignments which are always optimal. Otherwise, when the market is mild, PM and BM di¤er and each one implements the optimal rule under di¤erent assumptions on the curvature of virtual valuations. We also establish that both BM and PM mechanisms guarantee IC Pareto-optimal assignments for a domain of preference distributions satisfying weak assumptions.
Grants:	Ministerio de Ciencia y Tecnología ECO2014-53051-P Agència de Gestió d'Ajuts Universitaris i de Recerca 2014/SGR-505
Note:	Altres ajuts: SEV2011-0075
Note:	Altres ajuts: NSF/SES-1326584
Rights:	Tots els drets reservats.
Language:	Anglès
Document:	Article ; recerca ; Versió acceptada per publicar
Subject:	Mechanism design ; Welfare maximization ; Incentive-compatible Pareto frontier ; No transfers ; Assignment problems ; Pseudomarket ; Boston mechanism
Published in:	Journal of mathematical economics, Vol. 61 (Desembre 2015) , p. 253-270, ISSN 0304-4068

DOI: 10.1016/j.jmateco.2015.09.004

Postprint 43 p, 467.7 KB

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