Welfare-maximizing assignment of agents to hierarchical positions

Hafalir, I; Miralles, A

Welfare-maximizing assignment of agents to hierarchical positions

Hafalir, I

Miralles, A

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Publication Type:: Journal Article
Citation:: Journal of Mathematical Economics, 2015, 61 pp. 253 - 270
Issue Date:: 2015-01-01

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Field	Value	Language
dc.contributor.author	Hafalir, I https://orcid.org/0000-0002-6731-2848	en_US
dc.contributor.author	Miralles, A	en_US
dc.date.issued	2015-01-01	en_US
dc.identifier.citation	Journal of Mathematical Economics, 2015, 61 pp. 253 - 270	en_US
dc.identifier.issn	0304-4068	en_US
dc.identifier.uri	http://hdl.handle.net/10453/119364
dc.description.abstract	© 2015 Elsevier B.V. We allocate agents to three kinds of hierarchical positions: top, medium, and low. No monetary transfers are allowed. We solve for the incentive-compatible (IC) mechanisms that maximize a family of weighted social welfares that includes utilitarian and Rawlsian welfares. When the market is tough (all agents bear positive risk of obtaining a low position in any IC and feasible mechanism), then the pseudomarket mechanism with equal budgets (PM) and the Boston mechanism without priorities (BM) yield identical assignments which are always optimal. Otherwise, when the market is mild, PM and BM differ and each one implements the optimal rule under different assumptions on the curvature of virtual valuations. We also establish that both BM and PM mechanisms guarantee IC Pareto-optimal assignments for a domain of preference distributions satisfying weak assumptions.	en_US
dc.relation.ispartof	Journal of Mathematical Economics	en_US
dc.relation.isbasedon	10.1016/j.jmateco.2015.09.004	en_US
dc.subject.classification	Economic Theory	en_US
dc.title	Welfare-maximizing assignment of agents to hierarchical positions	en_US
dc.type	Journal Article
utslib.citation.volume	61	en_US
utslib.for	1401 Economic Theory	en_US
utslib.for	14 Economics	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Economics Discipline
utslib.copyright.status	closed_access
pubs.publication-status	Published	en_US
pubs.volume	61	en_US

Abstract:

© 2015 Elsevier B.V. We allocate agents to three kinds of hierarchical positions: top, medium, and low. No monetary transfers are allowed. We solve for the incentive-compatible (IC) mechanisms that maximize a family of weighted social welfares that includes utilitarian and Rawlsian welfares. When the market is tough (all agents bear positive risk of obtaining a low position in any IC and feasible mechanism), then the pseudomarket mechanism with equal budgets (PM) and the Boston mechanism without priorities (BM) yield identical assignments which are always optimal. Otherwise, when the market is mild, PM and BM differ and each one implements the optimal rule under different assumptions on the curvature of virtual valuations. We also establish that both BM and PM mechanisms guarantee IC Pareto-optimal assignments for a domain of preference distributions satisfying weak assumptions.

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http://hdl.handle.net/10453/119364