We address the design of optimal mechanisms for bargaining problems subject to incomplete information on reservation values. We characterize decent rules, those that are Pareto Optimal in the constrained set of rules satisfying strategy proofness, individual rationality and weak e±ciency a condition on ex-post e±ciency. We prove that for given concave utilities of the agents, the decent rule is...

We introduce a new and highly tractable structural model for spot and derivative prices in electricity markets. Using a stochastic model of the bid stack, we translate the demand for power and the prices of generating fuels into electricity spot prices. The stack structure allows for a range of generator efficiencies per fuel type and for the possibility of future changes in the merit order of ...

We propose a new class of strategy-proof and strongly budgetbalanced redistribution mechanisms called the sequential partition mechanism (SPM). Recently, studies on redistribution mechanisms have attracted increased attention in the research area of mechanism design to achieve a desirable social decision among self-interested agents. However, since no redistribution mechanism can simultaneously...

In a model of majority voting with common values and costly but voluntary participation, we show that in the vicinity of equilibrium, it is always Pareto-improving for more agents, on the average, to vote. This demonstrates that the negative voting externality identified by Borgers(2001) in the context of private values is always dominated by a positive informational externality. In addition, w...

Based upon the upper expected value, lower expected value and expected value operators of a fuzzy variable, this paper first presents three types of multicriteria maximum expected value models. Then a theorem about the connection of Pareto solutions among the maximum expected value models is proved. In addition, the relationship between maximum and minimum expected value models is discussed. At...

We study the optimal (i.e. revenue maximizing) auction of multiple products. We make three major points. First, we extend the relationship between price discrimination and optimal auctions from the single-product case to the multiple-product case. A monopolist setting prices for multiple products may offer discounts on purchases of bundles of products; similarly, the optimal auction of multiple...

This paper tries to reconcile incentive theory with transaction costs theory. We first discuss the fundamental assumptions underlying the use of the Revelation Principle in the standard mechanism design literature and show how various contractual incompletenesses and externalities induced by transaction costs affect the basic trade-off between allocative efficiency and informational rents highl...

Automated negotiation systems are becoming increasingly important and pervasive. Most previous research on automated negotiation has focused on understanding and formalizing “successful” negotiations, i.e., negotiations that do not become contentious to the point of impasse. This paper shifts the emphasis to negotiations that are “difficult” to resolve and can hit an impasse. It analyses a situ...

In a very recent paper by Kuo et al. [M.S. Kuo, G.H. Tzeng, W.C. Huang, Group decision-making based on concepts of ideal and anti-ideal points in a fuzzy environment, Mathematical and Computer Modelling 45 (3–4) (2007) 324–339], a fuzzy multicriteria decision analysis method based on the concepts of ideal and anti-ideal points was presented. This note illustrates with a numerical example that t...

Consider two principles for social evaluation. The first, ‘laissez-faire’, says that mean-preserving redistribution away from laissez-faire incomes should be regarded as a social worsening. This principle captures a key aspect of liberal political philosophy. The second, weak Pareto, states that an increase in each individual’s disposable income should be regarded as a social improvement. We sh...