Minimum cost connection networks: truth-telling and implementation

Publikation: Working paperForskning

In the present paper we consider the allocation of cost in connection networks. Agents have connection demands in form of pairs of locations they want to be connected. Connections between locations are costly to build. The problem is to allocate costs of networks satisfying all connection demands. We use three axioms to characterize allocation rules that truthfully implement cost minimizing networks satisfying all connection demands in a game where: (1) a central planner announces an allocation rule and a cost estimation rule; (2) every agent reports her own connection demand as well as all connection costs; and, (3) the central planner selects a cost minimizing network satisfying reported connection demands based on estimated connection costs and allocates true connection costs of the selected network.
OriginalsprogEngelsk
UdgiverDepartment of Food and Resource Economics, University of Copenhagen
Antal sider20
StatusUdgivet - 2013
NavnMSAP Working Paper Series
Nummer03/2013

ID: 105344529