Abstract
Barelli [P. Barelli, On the genericity of full surplus extraction in mechanism design, J. Econ. Theory 144 (2009) 1320-1332] defines beliefs-determine-preferences (BDP) models and argues that BDP models are nongeneric in a topological sense. In this note, we point out some difficulties in Barelli's approach. Furthermore, we follow the idea of Heifetz and Neeman [A. Heifetz, Z. Neeman, On the generic (im)possibility of full surplus extraction, Econometrica 74 (2006) 213-233] to propose a more relevant notion of BDP* model. We prove that BDP* models are generic, which is opposite to Barelli's conclusion. (C) 2010 Elsevier Inc. All rights reserved.
Original language | English |
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Pages (from-to) | 751-761 |
Number of pages | 11 |
Journal | Journal of Economic Theory |
Volume | 146 |
Issue number | 2 |
DOIs | |
Publication status | Published - Mar 2011 |
Keywords
- Mechanism design
- Full surplus extraction
- Beliefs-determine-preferences priors
- Common priors