Game Theory for Computer Scientists - Mechanism Design (Basic)

This tutorial describes an overview of mechanism design theory, which investigates a rule or a protocol for multiple agents to make a social decision. The theory models the decision problem as a games of incomplete information, where each player cannot directly observe her opponents'types. Under the assumption that each agent behaves so as to maximize her individual utility, mechanism design theory analyzes how a player chooses her action under a mechanism, while designs a mechanism to achieve a socially desirable outcome or a goal of the designer. This tutorial first briefly explains games of incomplete information and the concept of mechanism design. Then, as a typical example, we focus on auctions that sell a single item and explain several theoretical results on mechanism design theory.