New BERG Working Paper No. 180 by Thomas Daske and Christoph March published

In the BERG Working Paper Series 180 Thomas Daske and Christoph March have published a new paper entitled "Efficient Incentives with Social Preferences*".

A complete overview of all BERG Working Papers published so far can be found here.



This study explores mechanism design with allocation-based social preferences. Agents’ social preferences and private payoffs are all subject to asymmetric information. We assume quasi-linear utility and independent types. We show how the asymmetry of information about agents’ social preferences can be operationalized to satisfy agents’ participation constraints. Our main result is a possibility result for groups of at least three agents: If endowments are sufficiently large, any such group can resolve any given allocation problem with an ex-post budget-balanced mechanism that is Bayesian incentive-compatible, interim individually rational, and ex-post Pareto-efficient.