Agent's valuations are interdependent if they depend on the information signals, or types, of all agents. Under the implicit assumption that payments to agents cannot be delayed until after agents have observed their payoffs, previous literature has shown that with interdependent valuations and independent signals, efficient mechanisms cannot be designed. I introduce two-stage mechanisms, in which agents are first asked to report their types and after an allocation (more generally, an outcome) has taken place, they are asked to report their payoffs from the allocation. Interim payments can take place after the types have been reported, but final payments also depend on the payoff reports. I show that efficient two-stage mechanisms exist. Efficient mechanisms can be interpreted as generalized Vickrey-Clarke-Groves mechanisms. I also show that it is possible to provide agents with the incentives for efficient, ex-ante acquisition of information. Finally, I provide conditions under which an uninformed seller can extract (or virtually extract) the full surplus from a sale to privately informed buyers.
Prof. Claudio Mezzetti
Claudio Mezzetti is a Leverhulme Professor of Industry and Organisation at the University of Warwick since September 2007. He was previously a Professor of Economics at the University of Leicester (2005-2007) and University of North Carolina, Chapel Hill (1999-2005). He is a member of the American Economic Association, the Econometric Society, the Game Theory Society, and the Society for the Promotion of Economic Theory. He is also an associate editor of the B.E. Journal of Theoretical Economic and the Bulletin of Economic Research. He has published more than 20 papers in some of the best Economics journals including Games and Economic Behaviour, Econometrica, the Rand Journal of Economics, and the Journal of Economic Theory.