The ability of the members of a coalition to communicate secretly determines whether the coalition can coordinate to deviate from a proposed strategy and thus affects which strategies are ‘‘coalition proof.’’ We show that the existence of a Pareto-best element in the set of strategies that survive iterated elimination of dominated strategies implies the existence of a coalition-proof correlated...

We study how to partition a set of agents in a stable way when each coalition in the partition has to share a unit of a perfectly divisible good, and each agent has symmetric single-peaked preferences on the unit interval of his potential shares. A rule on the set of preference pro…les consists of a partition function and a solution. Given a preference pro…le, a partition is selected and as man...

This paper studies (single-valued) solutions to housing markets (Shapley and Scarf, 1974) with strict preferences. I show that a solution is monotonic if and only if it is coalition strategy-proof. I point out that the strong core solution is the only solution which is monotonic, individually rational and an onto function. (As Roth and Postlewaite (1977) showed, the strong core solution is sing...

This paper introduces a property over agents’ preferences, called Tops Responsiveness Condition. Such a property guarantees that the core in Hedonic Coalition Formation games is not empty. It is also shown that a mechanism exists that selects a stable allocation. It turns out that this mechanism, to be called tops covering, is strategy-proof even if the core is not a singleton. Furthermore, we ...

We study how an optimal income tax and an optimal public-goods provision rule respond to preference and productivity shocks. A conventional Mirrleesian treatment is shown to provoke manipulations of the policy mechanism by individuals with similar interests. We therefore extend the Mirrleesian model so as to include a requirement of coalition-proofness. The main results are the following: first...

We study a large economy model in which individuals have private information about their productive abilities and their preferences for public goods. A mechanism design approach is used to characterize implementable tax and expenditure policies. A robustness requirement in the sense of Bergemann and Morris (2005) yields individual incentive compatibility constraints that are equivalent to those...

We propose a new approach to the normative analysis of public-good provision in a large economy. Our analysis is based on a mechanism design approach that involves a requirement of coalition-proofness, as well as a requirement of robustness, so that the mechanism must not depend on specific assumptions about individual beliefs. Our main result shows that such a mechanism can condition only on t...

model of social choice, Gibbard (1973) and Satterthwaite (1975) show that – provided there are more than two alternatives at stake– every strategy-proof social choice rule is dictatorial. However, reasonable strategy-proof rules exist if appropriate restrictions are imposed on agents’ preferences. In coalition formation problems, such domain For further references, see the recent works by Baner...

We analyze coalition formation problems in which a group of agents is partitioned into coalitions and agents’ preferences only depend on the identity of the members of the coalition they are members of. We study rules that associate to each profile of agents’ preferences a partition of the society. We are interested in rules that never provide incentives for the agents to misrepresent their pre...