1. Collusion-proof mechanisms for multi-unit procurement
- Author
-
Martin Hagen
- Subjects
Computer Science::Computer Science and Game Theory ,History ,Mechanism design ,Mathematical optimization ,Economics and Econometrics ,Polymers and Plastics ,Computer science ,Principal (computer security) ,Function (mathematics) ,Industrial and Manufacturing Engineering ,Set (abstract data type) ,Procurement ,Collusion ,Fixed price ,Business and International Management ,Finite set ,Finance - Abstract
A principal wants to procure a discrete number of homogeneous units from a finite set of agents. Each agent has an increasing and convex cost function, whose exact shape is unknown to the principal. Utility is quasilinear in money. We characterize the set of mechanisms that are strategy-proof and robust to collusion. The latter is captured by reallocation-proofness (group strategy-proofness) if the colluding agents can (cannot) make side deals among each other. We show that in every reallocation-proof mechanism, the principal offers the agents a fixed price per unit. While group-strategy-proof mechanisms can be more complex, they cannot guarantee that the principal will receive exactly her desired quantity. We fully characterize the set of group-strategy-proof mechanisms with a uniform price.
- Published
- 2023