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Characterizing Truthfulness In Discrete Domains AHUVA MU ™ALEM Social and Information Sciences Laboratory, California Institute of Technology and MICHAEL SCHAPIRA The School of Computer Science and Engineering, The Hebrew University of Jerusalem, Israel1 Algorithmic mechanism design [9; 10] focuses on the design of algorithms that aim to achieve global objectives in settings in which the œinput  is provided by self-interested strategic players2 . This necessitates the design of algorithms that are incentive-compatible (a.k.a. truthful 3 ) in the sense that players are incentivized via payments to behave as instructed. The most natural approach to designing incentive-compatible algorithms is coming up with an algorithm and an explicit payment scheme that guarantees its incentive-compatibility. However, nding appropriate payments is often a di ƒcult, setting-speci c, task, which is mostly achievable for very simple types of algorithms. A more general approach is the following: Any algorithm that interacts with sel sh players and then outputs an outcome, can be regarded as computing a function, called a social-choice function, from the players ™ œinput  to some outcome space. Certain properties of social-choice functions are known to imply their implementability, that is, the existence of a payment scheme that guarantees incentivecompatibility.

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Characterizing truthfulness in discrete domains

Mu'alem, Ahuva; Schapria, Michael
ACM SIGecom Exchanges , Volume 7 (2)
Association for Computing MachineryJun 1, 2008

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