PER Distinguished Lecture: Vincent P. Crawford, “Efficient Mechanisms for Level-k Bilateral Trading”
Friday, April 20, 2018
Deutsches Haus, Columbia University
Press here to RSVP for planning purposes.
Professor Vincent P. Crawford revisits Roger Myerson and Mark Satterthwaite’s (1983; “MS”)
analysis of mechanism design for bilateral trading, replacing equilibrium with a non-equilibrium
“level-k” model that predicts initial responses to games, and focusing on direct mechanisms.
The revelation principle fails for level-k models. However, if only level-k- incentive-compatible
mechanisms are feasible, and if traders’ levels of reasoning are observable, MS’s
characterization of incentive-efficient mechanisms generalizes, with one novel feature. If
traders’ levels are unobservable, only posted-price mechanisms are level-k- incentive-compatible
and -incentive- efficient. By contrast, if non-level- k-incentive- compatible direct mechanisms are
also feasible, level-k- incentive-efficient mechanisms may differ more extensively from
equilibrium-incentive- efficient mechanisms.
About Vincent P. Crawford
Vincent Crawford is the Drummond Professor of Political Economy, University of Oxford; a Fellow of All Souls College; and Distinguished Professor Emeritus and Research Professor, University of California, San Diego. He holds an A.B. Summa cum Laude from Princeton University and a Ph.D. in Economics from the Massachusetts Institute of Technology. He is a Fellow of the Econometric Society, the Guggenheim Foundation, the American Academy of Arts and Sciences, the British Academy, and Academia Europea. He has served as co-editor of the American Economic Review and on the boards of Econometrica and several other journals; and he is currently one of the editors of Games and Economic Behavior and on the boards of several other journals.
Crawford is best known for his work on game-theoretic microeconomic theory, particularly on bargaining and arbitration, strategic communication, matching markets, learning, and coordination. He has given many mini-courses and invited lectures in these areas around the world, including an Arne Ryde Symposium Keynote address, the Royal Economic Society’s Economic Journal Lecture, and a John von Neumann Distinguished Lecture at Brown University’s 250th Anniversary Symposium. His current research is on behavioral and experimental game theory and behavioral economics more generally, and is the basis for a five-year European Research Council Advanced Grant, “Behavioural Economics and Strategic Decision Making: Theory, Empirics, and Experiments”.