University of Iowa
Essays on mechanism design under non-Bayesian frameworks.
Degree: PhD, Economics, 2018, University of Iowa
One important issue in mechanism design theory is to model agents’ behaviors under
uncertainty. The classical approach assumes that agents hold commonly known
probability assessments towards uncertainty, which has been challenged by economists
in many fields. My thesis adopts alternative methods to model agents’ behaviors. The
new findings contribute to understanding how the mechanism designer can benefit from
agents’ uncertainty aversion and how she should respond to the lack of information
on agents’ probability assessments.
Chapter 1 of this thesis allows the mechanism designer to introduce ambiguity to the
mechanism. Instead of informing agents of the precise payment rule that she commits
to, the mechanism designer can tell agents multiple payment rules that she may have
committed to. The multiple payment rules are called ambiguous transfers. As agents
do not know which rule is chosen by the designer, they are assumed to make decisions
based on the worst-case scenario. Under this assumption, this chapter characterizes
when the mechanism designer can obtain the first-best outcomes by introducing
ambiguous transfers. Compared to the standard approach where the payment rule is
unambiguous, first-best mechanism design becomes possible under a broader
information structure. Hence, there are cases when the mechanism designer can
benefit from introducing ambiguity.
Chapter 2 assumes that the mechanism designer does not know agents’ probability
assessments about others’ private information. The mechanisms designed to implement
the social choice function thus should not depend on the probability assessments,
which are called robust mechanisms. Different from the existing robust mechanism
design literature where agents are always assumed to act non-cooperatively, this
chapter allows them to communicate and form coalitions. This chapter provides
necessary and almost sufficient conditions for robustly implementing a social choice
function as an equilibrium that is immune to all coalitional deviations. As there
are social choice functions that are only implementable with coalitional structures,
this chapter provides insights on when agents should be allowed to communicate. As
an extension, when the mechanism designer has no information on which coalitions can
be formed, this chapter also provides conditions for robust implementation under all
Chapter 3 assumes that agents are not probabilistic about others’ private
information. Instead, when they hold ambiguous assessments about others’
Advisors/Committee Members: Yannelis, Nicholas C. (supervisor).
Subjects/Keywords: ambiguity aversion; coalition; full surplus extraction; implementation; mechanism design; robustness; Economics
to Zotero / EndNote / Reference
APA (6th Edition):
Guo, H. (2018). Essays on mechanism design under non-Bayesian frameworks. (Doctoral Dissertation). University of Iowa. Retrieved from https://ir.uiowa.edu/etd/6122
Chicago Manual of Style (16th Edition):
Guo, Huiyi. “Essays on mechanism design under non-Bayesian frameworks.” 2018. Doctoral Dissertation, University of Iowa. Accessed September 21, 2020.
MLA Handbook (7th Edition):
Guo, Huiyi. “Essays on mechanism design under non-Bayesian frameworks.” 2018. Web. 21 Sep 2020.
Guo H. Essays on mechanism design under non-Bayesian frameworks. [Internet] [Doctoral dissertation]. University of Iowa; 2018. [cited 2020 Sep 21].
Available from: https://ir.uiowa.edu/etd/6122.
Council of Science Editors:
Guo H. Essays on mechanism design under non-Bayesian frameworks. [Doctoral Dissertation]. University of Iowa; 2018. Available from: https://ir.uiowa.edu/etd/6122