Redistribution Mechanisms

Mingyu Guo and Vincent Conitzer

For the problem of allocating items among multiple agents, the well-known VCG mechanism is efficient and strategy-proof. However, in general, the VCG mechanism is not budget balanced: payments flow out the system of agents, which reduces the agents’ utilities. Redistribution mechanisms aim to return some of the VCG payments back to the agents, without affecting the desirable properties of the VCG mechanism (including allocative efficiency, strategy-proofness, individual rationality, and the non-deficit property).

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