Algorithmic mechanism design

Algorithmic mechanism design (AMD) lies at the intersection of economic game theory, optimization, and computer science. The prototypical problem in mechanism design is to design a system for multiple self-interested participants, such that the participants' self-interested actions at equilibrium lead to good system performance. Typical objectives studied include revenue maximization and social welfare maximization. Algorithmic mechanism design differs from classical economic mechanism design in several respects. It typically employs the analytic tools of theoretical computer science, such as worst case analysis and approximation ratios, in contrast to classical mechanism design in economics which often makes distributional assumptions about the agents. It also considers computational constraints to be of central importance: mechanisms that cannot be efficiently implemented in polynomial time are not considered to be viable solutions to a mechanism design problem. This often, for example, rules out the classic economic mechanism, the Vickrey–Clarke–Groves auction.

History

Noam Nisan and Amir Ronen, from the Hebrew University of Jerusalem, first coined "Algorithmic mechanism design" in a research paper published in 1999.[1][2]

gollark: *picks up random AP egg**is from terrafreaky*
gollark: AP hunting is great right now.
gollark: Ah, yes, delicious hard-boiled dragon egg.
gollark: The names of four-dimensional solids are *great* dragon names, too!
gollark: For a brief, glorious moment after that occurs, CB metals will become maybe a few times more common.

See also

References and notes
  1. Nisan, Noam; Ronen, Amir (1999), "Algorithmic mechanism design", Proceedings of the Thirty-first Annual ACM Symposium on Theory of Computing: 129–140, doi:10.1145/301250.301287, ISBN 978-1581130676.
  2. Nisan, Noam; Ronen, Amir (2001). "Algorithmic Mechanism Design". Games and Economic Behavior. 35 (1–2): 166–196. doi:10.1006/game.1999.0790.

Further reading
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