Two axiomatic approaches to the probabilistic serial mechanism. Issue 1 (January 2014)

• Record Type: Journal Article
• Authors: Hashimoto, Tadashi; Hirata, Daisuke; Kesten, Onur; Kurino, Morimitsu; Ünver, M. Utku
• Is Part Of: Theoretical economics. Volume 9:Issue 1(2014:Jan.)
• Page Start: 253
• Page End: 277
• Publication Date: 2014-01
• Subjects: Economics -- Periodicals; 330.01
• DOI: 10.3982/TE1010
• Languages: English
• ISSNs: 1933-6837

Abstract

<abstract abstract-type="main" xml:lang="en"> <title> <x xml:space="preserve">Abstract</x> </title> <p>This paper studies the problem of assigning a set of indivisible objects to a set of agents when monetary transfers are not allowed and agents reveal only ordinal preferences, but random assignments are possible. We offer two characterizations of the <italic>probabilistic serial</italic> mechanism, which assigns lotteries over objects. We show that it is the only mechanism that satisfies <italic>non‐wastefulness</italic> and <italic>ordinal fairness</italic>, and the only mechanism that satisfies <italic>sd‐efficiency</italic>, <italic>sd‐envy‐freeness</italic>, and <italic>weak invariance</italic> or <italic>weak truncation robustness</italic> (where "sd" stands for first‐order stochastic dominance).</p> </abstract>