Hougaard, J.L. and Tvede, M. orcid.org/0000-0003-0566-7026 (2015) Minimum cost connection networks: truth-telling and implementation. Journal of Economic Theory, 157. pp. 76-99. ISSN 0022-0531
Abstract
In the present paper we consider the allocation of costs in connection networks. Agents have connection demands in form of pairs of locations they want to have connected. Connections between locations are costly to build. The problem is to allocate costs of networks satisfying all connection demands. We use a few axioms to characterize allocation rules that truthfully implement cost minimizing networks satisfying all connection demands in a game where: (1) a central planner announces an allocation rule and a cost estimation rule; (2) every agent reports her own connection demand as well as all connection costs; (3) the central planner selects a cost minimizing network satisfying reported connection demands based on the estimated costs; and, (4) the planner allocates the true costs of the selected network. It turns out that an allocation rule satisfies the axioms if and only if relative cost shares are fixed.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2014 Elsevier Inc. This is an author produced version of a paper subsequently published in Journal of Economic Theory. Uploaded in accordance with the publisher's self-archiving policy. Article available under the terms of the CC-BY-NC-ND licence (https://creativecommons.org/licenses/by-nc-nd/4.0/). |
Keywords: | Axiomatic characterization; Connection networks; Cost sharing; Implementation; Truth-telling |
Dates: |
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Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 05 Jan 2023 17:00 |
Last Modified: | 05 Jan 2023 17:00 |
Status: | Published |
Publisher: | Elsevier BV |
Refereed: | Yes |
Identification Number: | 10.1016/j.jet.2014.12.009 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:194904 |
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