The net effect of advice on strategy-proof mechanisms : An experiment for the Vickrey auction

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Description

We conduct laboratory experiments for the Vickrey auction with and without an announcement on strategy-proofness to subjects. Although the rate of truth-telling among the subjects stays at 20% without the announcement, it increases to 47% with the announcement. Moreover, by conducting experiments for the pay-your-bid auction, which is not strategy-proof, with and without advice, we find that our experimental results are not attributed to so-called experimenter demand effects. Strategy-proof mechanisms are sometimes criticized because players often fail to find the benefit of truth-telling, but our observations tell that introducing an educative announcement helps them behave "correctly".

Journal

  • ISER discussion paper

    ISER discussion paper (1109), 1-32, 2020-12

    Toyonaka : Institute of Social and Economic Research

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