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Non-Manipulable House Exchange under (Minimum) Equilibrium Prices

Andersson, Tommy LU ; Ehlers, Lars LU and Svensson, Lars-Gunnar LU (2020) In Working Papers
Abstract
We consider a market with indivisible objects, called houses, and monetary transfers. Each house is initially occupied by one agent and each agent demands exactly one house. The problem is to identify the complete set of direct allocation mechanisms that can be used to reallocate the houses among the agents. On the one hand, for price equilibrium mechanisms, we show that the only strategy-proof mechanism is one with a minimum equilibrium price vector. The result is not true on the classical or the quasi-linear domains, but on reduced domains of preference profiles containing “almost all” profiles in the classical or the quasi-linear domain, respectively. On the other hand, while minimum price equilibrium mechanisms are not necessarily... (More)
We consider a market with indivisible objects, called houses, and monetary transfers. Each house is initially occupied by one agent and each agent demands exactly one house. The problem is to identify the complete set of direct allocation mechanisms that can be used to reallocate the houses among the agents. On the one hand, for price equilibrium mechanisms, we show that the only strategy-proof mechanism is one with a minimum equilibrium price vector. The result is not true on the classical or the quasi-linear domains, but on reduced domains of preference profiles containing “almost all” profiles in the classical or the quasi-linear domain, respectively. On the other hand, while minimum price equilibrium mechanisms are not necessarily efficient (as prices are not zero), we show that no strategy-proof mechanism Pareto dominates a minimum price equilibrium mechanism, making them constrained efficient in the class of strategy-proof mechanisms. (Less)
Please use this url to cite or link to this publication:
author
; and
organization
publishing date
type
Working paper/Preprint
publication status
published
subject
keywords
house allocation, initial endowments, minimum equilibrium prices, strategyproofness, constrained efficiency, C71, C78, D47, D71, D78
in
Working Papers
issue
2020:28
pages
18 pages
language
English
LU publication?
yes
id
8d9595b9-3d10-4ad7-b98c-f23092610ff2
date added to LUP
2021-01-25 15:45:23
date last changed
2025-04-04 15:22:18
@misc{8d9595b9-3d10-4ad7-b98c-f23092610ff2,
  abstract     = {{We consider a market with indivisible objects, called houses, and monetary transfers. Each house is initially occupied by one agent and each agent demands exactly one house. The problem is to identify the complete set of direct allocation mechanisms that can be used to reallocate the houses among the agents. On the one hand, for price equilibrium mechanisms, we show that the only strategy-proof mechanism is one with a minimum equilibrium price vector. The result is not true on the classical or the quasi-linear domains, but on reduced domains of preference profiles containing “almost all” profiles in the classical or the quasi-linear domain, respectively. On the other hand, while minimum price equilibrium mechanisms are not necessarily efficient (as prices are not zero), we show that no strategy-proof mechanism Pareto dominates a minimum price equilibrium mechanism, making them constrained efficient in the class of strategy-proof mechanisms.}},
  author       = {{Andersson, Tommy and Ehlers, Lars and Svensson, Lars-Gunnar}},
  keywords     = {{house allocation; initial endowments; minimum equilibrium prices; strategyproofness; constrained efficiency; C71; C78; D47; D71; D78}},
  language     = {{eng}},
  note         = {{Working Paper}},
  number       = {{2020:28}},
  series       = {{Working Papers}},
  title        = {{Non-Manipulable House Exchange under (Minimum) Equilibrium Prices}},
  url          = {{https://lup.lub.lu.se/search/files/199050224/WP20_28.pdf}},
  year         = {{2020}},
}