Mechanism Design with Moral Bidders
summary
Defines an alpha-moral bidder model where a bidder lies only if profit > alpha × sum of others' losses; constructs deterministic single-item mechanisms and gives a constructive proof (alternative to Myerson) that for i.i.d. standard distributions moral mechanisms never beat truthful revenue, while for correlated “quality” distributions moral mechanisms can extract more, sometimes up to twice the revenue. Shows payment flexibility (e.g., charge half the second price) and a concrete non-monotone allocation that is 1-moral and individually rational.
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