Open AccessTwo axiomatic approaches to the probabilistic serial mechanism
Author(s) -
Hashimoto Tadashi,
Hirata Daisuke,
Kesten Onur,
Kurino Morimitsu,
Ünver M. Utku
Publication year - 2014
Publication title -
theoretical economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 4.404
H-Index - 32
eISSN - 1555-7561
pISSN - 1933-6837
DOI - 10.3982/te1010
Subject(s) - stochastic dominance , axiom , probabilistic logic , mathematical economics , computer science , mechanism (biology) , robustness (evolution) , set (abstract data type) , mathematics , axiomatic system , mathematical optimization , artificial intelligence , philosophy , geometry , epistemology , biochemistry , chemistry , gene , programming language
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 probabilistic serial mechanism, which assigns lotteries over objects. We show that it is the only mechanism that satisfies non‐wastefulness and ordinal fairness , and the only mechanism that satisfies sd‐efficiency , sd‐envy‐freeness , and weak invariance or weak truncation robustness (where “sd” stands for first‐order stochastic dominance).