Robust trading mechanisms

Kathleen M. Hagerty; William P. Rogerson

doi:10.1016/0022-0531(87)90104-9

Robust trading mechanisms

Kathleen M. Hagerty^*, William P. Rogerson

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

77 Scopus citations

Abstract

We consider the problem of designing a trading institution for a single buyer and seller when their valuation of the good is private information. It is shown that posted-price mechanisms are essentially the only mechanisms such that each trader has a dominant strategy. A posted-price mechanism is one where a price is posted in advance and trade occurs if and only if all traders agree to trade.

Original language	English (US)
Pages (from-to)	94-107
Number of pages	14
Journal	Journal of Economic Theory
Volume	42
Issue number	1
DOIs	https://doi.org/10.1016/0022-0531(87)90104-9
State	Published - Jun 1987

Funding

* We would like to acknowledge extremely helpful comments and discussions with Roger Myerson. Rogerson’s work was supported by NSF Grant SES-8504034. ’ See D’Aspermont and Gerard-Varet [2], Laffont and Maskin [S], Myerson [6], Vickery [9], and Wilson [lo, 11, 121 for related literature.

ASJC Scopus subject areas

Economics and Econometrics

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10.1016/0022-0531(87)90104-9

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author = "Hagerty, \{Kathleen M.\} and Rogerson, \{William P.\}",

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Robust trading mechanisms

Abstract

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ASJC Scopus subject areas

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