Abstract.
In exchange economies where agents have private information about their preferences, strategy-proof and individually rational social choice functions are in general not efficient. We provide a restricted domain, namely the set of preferences representable by Leontief utility functions, where there exist mechanisms which are strategy-proof, efficient and individually rational. In two-agent, two-good economies we are able to provide an even stronger result. We characterize the class of efficient and individually rational social choice functions, which are fully implementable in truthful strategies.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
Author information
Authors and Affiliations
Corresponding author
Additional information
Received: 28 April 2003, Accepted: 23 June 2003,
JEL Classification:
D51, D71
The author thanks Matthew Jackson, Jordi Massó and James Schummer for fruitful discussions, William Thomson for many valuable comments on an earlier version. A particular thank to Salvador Barberá for his fundamental help.
Rights and permissions
About this article
Cite this article
Nicoló, A. Efficiency and truthfulness with Leontief preferences. A note on two-agent, two-good economies. Review Economic Design 8, 373–382 (2004). https://doi.org/10.1007/s10058-003-0112-0
Issue Date:
DOI: https://doi.org/10.1007/s10058-003-0112-0