Transactions and Mechanism Design ∗ Thorsten
نویسندگان
چکیده
We introduce a dynamic model in which the ability of agents to perform certain welfare improving transactions is subject to random and unobservable shocks. We characterize the optimal setup for incentive compatible transactions, the optimal payment system. Implementation involves assigning balances to individual agents and optimally adjusting these balances given the agents’ histories of transactions. The existence of an equilibrium in which agents transact through a payment system requires certain caps on shortterm borrowing. In the absence of settlement, incentive constraints imply that the full information first-best allocation cannot be supported. We introduce a periodic pattern in which several rounds of bilateral transactions are followed by centralized settlement. We consider both the case where there is discounting between transaction rounds, and the case where there is none. The first-best is supportable if settlement takes place with a sufficiently high frequency. The Friedman rule is not necessary for efficiency since a policy that leads to a constant supply of nominal balances implements the firstbest. As in Levine (1991), if settlement rounds are infrequent, the first-best allocation is not supportable within a payment system that operates under a Friedman-like rule.
منابع مشابه
A truthful Screening Mechanism for Improving Information Asymmetry in Initial Public Offering Transactions
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