Credible Mechanisms

Consider an extensive-form mechanism, run by an auctioneer who communicates sequentially and privately with agents. Suppose the auctioneer can make any deviation that no single agent can detect. We study the mechanisms such that it is incentive-compatible for the auctioneer not to deviate - the credible mechanisms. Consider the optimal auctions in which only winners make transfers. The first-price auction is the unique credible static mechanism. The ascending auction is the unique credible strategy-proof mechanism.

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