Ratifiable Mechanisms: Learning from Disagreement

Peter C. Cramton, Thomas R. Palfrey
1995 Games and Economic Behavior  
In a mechanism design problem, participation constraints require that all types prefer the proposed mechanism to some status quo. If equilibrium play in the status quo mechanism depends on the players' beliefs, then the inference drawn if someone objects to the proposed mechanism may alter the participation constraints. We investigate this issue by modeling the mechanism design problem as a two-stage process, consisting of a ratification stage followed by the actual play of the chosen game. We
more » ... evelop and illustrate a new concept, ratifiability, that takes account of inferences from a veto in a consistent way.
doi:10.1006/game.1995.1032 fatcat:tdhxv4oflfhldea3idfbfgdmnq