Abstract
This paper uses results from [Karni, E., Safra, Z., 1987, Preference reversals and the observability of preferences by experimental methods, Econometrica 55, 675–685] and [Karni, E., 1989, Generalized expected utility analysis of multivariate risk aversion, International Economic Review 30, 297–305] to show that the Becker-DeGroot-Marschak mechanism is not always incentive compatible, even when the item to be valued involves no uncertainty, contrary to several recent assertions.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have