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Friend-Based Ranking†

Friend-Based Ranking† AbstractWe analyze the design of a mechanism to extract a ranking of individuals according to a unidimensional characteristic, such as ability or need. Individuals, connected on a social network, only have local information about the ranking. We show that a planner can construct an ex post incentive compatible and efficient mechanism if and only if every pair of friends has a friend in common. We characterize the windmill network as the sparsest social network for which the planner can always construct a complete ranking. (JEL D11, D82, D83, D85, O12, Z13) http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png American Economic Journal: Microeconomics American Economic Association

Friend-Based Ranking†

Friend-Based Ranking†

American Economic Journal: Microeconomics , Volume 14 (2) – May 1, 2022

Abstract

AbstractWe analyze the design of a mechanism to extract a ranking of individuals according to a unidimensional characteristic, such as ability or need. Individuals, connected on a social network, only have local information about the ranking. We show that a planner can construct an ex post incentive compatible and efficient mechanism if and only if every pair of friends has a friend in common. We characterize the windmill network as the sparsest social network for which the planner can always construct a complete ranking. (JEL D11, D82, D83, D85, O12, Z13)

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Publisher
American Economic Association
Copyright
Copyright © 2022 © American Economic Association
ISSN
1945-7685
DOI
10.1257/mic.20190333
Publisher site
See Article on Publisher Site

Abstract

AbstractWe analyze the design of a mechanism to extract a ranking of individuals according to a unidimensional characteristic, such as ability or need. Individuals, connected on a social network, only have local information about the ranking. We show that a planner can construct an ex post incentive compatible and efficient mechanism if and only if every pair of friends has a friend in common. We characterize the windmill network as the sparsest social network for which the planner can always construct a complete ranking. (JEL D11, D82, D83, D85, O12, Z13)

Journal

American Economic Journal: MicroeconomicsAmerican Economic Association

Published: May 1, 2022

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