This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

The AEA website will be offline for brief scheduled maintenance after 6:00pm (EDT) this evening.
  1. Home
  2. Journals
  3. American Economic Review
  4. May 2012
  5. Approximation in Mechanism Design

Approximation in Mechanism Design

  • Jason D. Hartline
American Economic Review
vol. 102, no. 3, May 2012
(pp. 330-36)
Download Full Text PDF

Abstract

This paper considers three challenge areas for mechanism design and describes the role approximation plays in resolving them. Challenge 1: optimal mechanisms are finely tuned to precise details of the distribution on agent preferences. Challenge 2: in environments with multi-dimensional agent preferences economic analysis has failed to provide general characterizations optimal mechanisms. Challenge 3: optimal mechanisms are parameterized by unrealistic knowledge of the distribution of agents' private preferences. This paper surveys positive resolutions to these challenges with emphasis on basic techniques and their relevance to theory and practice.

Citation

Hartline, Jason D. 2012. "Approximation in Mechanism Design." American Economic Review, 102 (3): 330-36. DOI: 10.1257/aer.102.3.330

JEL Classification

  • D82 Asymmetric and Private Information