We study banking using the tools of mechanism design, without a priori assumptions about what banks are, who they are, or what they do. Given preferences, technologies, and certain frictions –including limited commitment and imperfect monitoring –we describe the set of incentive feasible allocations and interpret the outcomes in terms of institutions that resemble banks. Our bankers endogenousl...

In applications of theories of incentives, the information known privately by an economic agent is represented by a point in a Euclidean space. Other agents know the probability distribution of this point, but not its realization, which is called the agent’s type. For models of this sort, designs of optimal incentive schemes present few difficulties when agents’ types are one-dimensional. The c...

The Generalized Second Price (GSP) auction has appealing properties when ads are simple (text based and identical in size), but does not generalize to richer ad settings, whereas truthful mechanisms such as VCG do. However, a straight switch from GSP to VCG incurs significant revenue loss for the search engine. We introduce a transitional mechanism which encourages advertisers to update their b...

This thesis addresses three challenges in algorithmic mechanism design, which seeks to devise computationally efficient mechanisms consisting of an outcome rule and a payment rule that implement desirable outcomes in strategic equilibrium. The first challenge that we address is the design of expressive mechanisms, i.e., mechanisms that allow the participating agents to express rich preferences....

vi = θ1 + θ2 Assume for simplicity that the θi are i.i.d. random variables with a continuous density on [0, 1]. How would you bid in a first price auction? How would you bid in a second price auction? Does the second price auction have dominant strategy equilibria? Does the game have other equilibria that are similar to dominant strategy equilibria in some sense? Analysis of the first price auc...

Design of mechanisms for transferring motion and energy from an input link to an output link has been studied extensively since the Industrial Revolution – in the steam engine, invented by James Watt, widely acknowledged to have started the Industrial revolution, Watt designed a straight-line mechanism to pull and push the piston-rod. Traditional mechanisms are most often made with lower pair j...

We study strategyproof (SP) mechanisms for the location of a facility on a discrete graph.We give a full characterization of SP mechanisms on lines and on sufficiently large cycles. In-terestingly, the characterization deviates from the one given by Schummer and Vohra [21] for thecontinuous case. In particular, it is shown that an SP mechanism on a cycle is close to dictatorial,...

Classic direct mechanisms require full utility revelation from agents, which can be very difficult in practical multi-attribute settings. In this work, we study partial revelation within the framework of one-shot mechanisms. Each agent’s type space is partitioned into a finite set of partial types and agents (should) report the partial type within which their full type lies. A classic result im...

Title of dissertation: MECHANISM DESIGN WITH GENERAL UTILITIES Saeed Alaei, Doctor of Philosophy, 2012 Dissertation directed by: Professor Samir Khuller Department of COMPUTER SCIENCE This thesis studies mechanism design from an optimization perspective. Our main contribution is to characterize fundamental structural properties of optimization problems arising in mechanism design and to exploit...