Full surplus extraction and within‐period ex post implementation in dynamic environments

We study full surplus extraction and implementation in dynamic environments. We exploit intertemporal correlations of agents' types to construct within‐period ex post incentive compatible mechanisms. First, we formulate one‐shot environments, in which a single agent has a hidden type and the planner observes a public signal about the agent's type after a type‐contingent allocation is chosen. We propose necessary and sufficient conditions for full surplus extraction (strong detectability) and for implementability of the targeted allocation rule (weak detectability) in this one‐shot problem. We decompose the general dynamic problem into one‐shot problems, and obtain sufficient conditions for surplus extraction and implementation.