Abstract
This paper studies the design of e¢ cient mechanisms for repeated trade in settings where (i) tradersvalues and costs evolve randomly with time, and (ii) the traders become ready and available to participate in the mechanism at random times. Under a weak condition, analogous to the non-overlapping supports condition of Myerson and Satterthwaite (1983), e¢ cient trade is only feasible if the mechanism runs an expected budget decit. The smallest such decit is attainable by a sequence of static mechanisms.
Keywords
dynamic mechanism design; repeated trade; budget balance; dynamic arrivals; participation constraints;
JEL codes
- D82: Asymmetric and Private Information • Mechanism Design
Reference
Daniel F. Garrett, Ready to trade? On budget-balanced efficient trade with uncertain arrival, September 2016.
See also
Published in
September 2016