Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/222422
Authors: 
Hougaard, Jens Leth
Tvede, Mich
Year of Publication: 
2020
Series/Report no.: 
IFRO Working Paper 2020/06
Abstract: 
We consider a connection networks model. Every agent has a demand in the form of pairs of locations she wants connected, and a willingness to pay for connectivity. A planner aims at implementing a welfare maximizing network and allocating the resulting cost, but information is asymmetric: agents are fully informed, the planner is ignorant. The options for full implementation in Nash and strong Nash equilibria are studied. We simplify strategy sets without changing the set of Nash implementable correspondences. We show the correspondence of consisting of welfare maximizing networks and individually rational cost allocations is implementable. We construct a minimal Nash implementable desirable solution in the set of upper hemi-continuous and Nash implementable solutions. It is not possible to implement solutions such a the Shapley value unless we settle for partial implementation.
Subjects: 
Connection networks
Welfare maximization
Nash Implementation
Strong Nash Implementation
JEL: 
C70
C72
D71
D85
Document Type: 
Working Paper

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