Characterization of Revenue Equivalence

B. Heydenreich; R.J. Müller; M.J. Uetz; R. Vohra

doi:10.3982/ECTA7168

Characterization of Revenue Equivalence

B. Heydenreich^*, R.J. Müller, M.J. Uetz, R. Vohra

^*Corresponding author for this work

Quantitative Economics

Research output: Contribution to journal › Article › Academic › peer-review

Abstract

The property of an allocation rule to be implementable in dominant strategies by a unique payment scheme is called revenue equivalence. We give a characterization of revenue equivalence based on a graph theoretic interpretation of the incentive compatibility constraints. The characterization holds for any (possibly infinite) outcome space and many of the known results are immediate consequences. Moreover, revenue equivalence can be identified in cases where existing theorems are silent.

Original language	English
Pages (from-to)	307-316
Number of pages	10
Journal	Econometrica
Volume	77
Issue number	1
DOIs	https://doi.org/10.3982/ECTA7168
Publication status	Published - 1 Jan 2009

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abstract = "The property of an allocation rule to be implementable in dominant strategies by a unique payment scheme is called revenue equivalence. We give a characterization of revenue equivalence based on a graph theoretic interpretation of the incentive compatibility constraints. The characterization holds for any (possibly infinite) outcome space and many of the known results are immediate consequences. Moreover, revenue equivalence can be identified in cases where existing theorems are silent.",

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AB - The property of an allocation rule to be implementable in dominant strategies by a unique payment scheme is called revenue equivalence. We give a characterization of revenue equivalence based on a graph theoretic interpretation of the incentive compatibility constraints. The characterization holds for any (possibly infinite) outcome space and many of the known results are immediate consequences. Moreover, revenue equivalence can be identified in cases where existing theorems are silent.

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