@techreport{f85415e760684baca6e16dc77c43e7f7,
title = "Mechanism Design and Robust Control",
abstract = "In this paper we introduce robust control methods in mechanism design problems. We assume that in the presence of an incentive compatible mechanism, players behave as if their types were in a δ-neighborhood of their true types. The designer{\textquoteright}s problem is to set up a mechanism that implements a given social choice function taking these δ-perturbations into account. In our results we characterize the social choice functions that are robust to the δ-perturbations, in the sense that the designers{\textquoteright} loss is at most of order δk for a certain k. A notable finding is that in quasi-linear utilitarian environments the designer{\textquoteright}s loss is of order of δ2.",
author = "Javier Rivas",
year = "2014",
month = may,
day = "8",
language = "English",
series = "Bath Economics Research Working Papers",
publisher = "Department of Economics, University of Bath",
number = "22/14",
type = "WorkingPaper",
institution = "Department of Economics, University of Bath",
}