Abstract.
We consider economies with a single indivisible good and money. We characterize the set of mechanisms that satisfy strategy-proofness, individual rationality, equal compensation, and demand monotonicity. There are three types of mechanisms which have the following properties: (i) they determine the allocation of monetary compensation depending on who receives the indivisible good; (ii) they allocate the indivisible good to one of the pre-specified (one or two) agent(s); and (iii) they disregard preferences of agents other than the pre-specified agent(s). This result implies that the presence of an indivisible good induces serious asymmetry in mechanisms.
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Received: 26 March 1996 / Accepted: 23 September 1997
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Ohseto, S. Strategy-proof allocation mechanisms for economies with an indivisible good. Soc Choice Welfare 16, 121–136 (1999). https://doi.org/10.1007/s003550050134
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DOI: https://doi.org/10.1007/s003550050134