Reinterpreting King Solomon's Problem: Malice and Mechanism Design
I argue for an alternative interpretation of King Solomon's problem in terms of one of the two claimants being “malicious”. A “malicious” claimant places no intrinsic value on the object but derives utility from depriving the rival claimant. This new interpretation permits a simpler solution th...
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Format: | text |
Language: | English |
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Institutional Knowledge at Singapore Management University
2014
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Online Access: | https://ink.library.smu.edu.sg/soe_research/1527 https://ink.library.smu.edu.sg/context/soe_research/article/2526/viewcontent/ReinterpretingKingSolomonProblem_2014_JEBO.pdf |
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Institution: | Singapore Management University |
Language: | English |
Summary: | I argue for an alternative interpretation of King Solomon's problem in terms of one of the two claimants being “malicious”. A “malicious” claimant places no intrinsic value on the object but derives utility from depriving the rival claimant. This new interpretation permits a simpler solution than those considered in the literature; I derive a mechanism that induces truthful revelation where the equilibrium involves a single round of elimination of weakly dominated strategies, and no monetary transfers. I consider extensions which allow for the malicious claimant to also place some low but positive intrinsic valuation on the object; I also discuss the possibility of two-sided malice, and provide examples of several real-life contexts to which the mechanism or its extensions are applicable. |
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