Ordinal simplicity in discrete mechanism design

In environments without transfers, market designers usually restrict attention to ordinal mechanisms. Ordinal mechanisms are simpler but miss potentially welfare‐relevant information. Under what conditions is it without loss to focus on ordinal mechanisms? We show that all group strategy‐proof mechanisms are ordinal. While not all Pareto efficient mechanisms are ordinal, all mechanisms maximizing an Arrovian social welfare function must be. These results accommodate feasibility constraints and allow for simple or complex demand. As applications, we characterize important classes of mechanisms in public choice and in the allocation of private goods under unit and multiunit demand.

Publication Details

Journal
Universität Zürich, ZORA
Published
2025-10-01
DOI
https://doi.org/10.5167/uzh-292020
Primary Topic
Auction Theory and Applications
Type
article
Field-Weighted Citation Impact
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article

Ordinal simplicity in discrete mechanism design

Universität Zürich, ZORA
Auction Theory and Applications
article

Ordinal simplicity in discrete mechanism design

article en

Abstract

In environments without transfers, market designers usually restrict attention to ordinal mechanisms. Ordinal mechanisms are simpler but miss potentially welfare‐relevant information. Under what conditions is it without loss to focus on ordinal mechanisms? We show that all group strategy‐proof mechanisms are ordinal. While not all Pareto efficient mechanisms are ordinal, all mechanisms maximizing an Arrovian social welfare function must be. These results accommodate feasibility constraints and allow for simple or complex demand. As applications, we characterize important classes of mechanisms in public choice and in the allocation of private goods under unit and multiunit demand.

Universität Zürich, ZORA
Reduced inequalities
Openalex Percentile: Top 20%
Auction Theory and Applications
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Ordinal simplicity in discrete mechanism design · Universität Zürich, ZORA (2025) | TGRS Research Map | TGRS