The Effect of False-name Declarations in Mechanism Design:
Towards Collective Decision Making on the Internet
Makoto Yokoo, Yuko Sakurai, and Shigeo Matsubara
20th International Conference on Distributed Computing Systems
The purpose of this paper is to analyze a collective decision making
problem in an open, dynamic environment, such as the Internet.
More specifically, we study a class of mechanism design problems
where the designer of a mechanism cannot completely identify
the participants (agents) of the mechanism.
A typical example of such a situation is Internet auctions.
The main contributions of this paper are as follows.
- We develop a formal model of
a mechanism design problem in which false-name declarations are
possible, and prove that the revelation principle still holds in this model.
- When false-name declarations and hiding are possible,
we show that there exists no auction protocol that achieves Pareto
efficient allocations in a dominant strategy equilibrium for all cases.
- We show a sufficient condition where the Clarke mechanism
is robust against false-name declarations (the concavity of the
maximal total utility of agents).