Efficient bilateral trade with interdependent values: The use of two-stage mechanisms

• Main Authors: KUNIMOTO, Takashi, ZHANG, Cuiling
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2025
• Subjects: Bilateral trade; interdependent values; two-stage mechanisms; Economic Theory
• Online Access: https://ink.library.smu.edu.sg/soe_research/2378; https://ink.library.smu.edu.sg/context/soe_research/article/3377/viewcontent/Efficient_Bilateral_Trade_Jan_28_2025__Edited_.pdf
• Institution: Singapore Management University

Efficient, voluntary bilateral trades are generally not implementable in an interdependent values environment where agents’ information is ex ante symmetric (i.e., both parties have private information, and each party’s valuation depends on the other’s information in the same way). To address this l...