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About this paper
Dirk Bergemann, Yang Cai, Kangning Wang, Jinzhao Wu, Renzhe Xu
The authors prove via duality that mechanisms with truthful reporting, voluntary participation, and balanced budgets capture at least half of first-best gains from trade. Their proof uses Markov chains and coupled clocks, not an explicit implementation. The guarantee holds for finite-type markets with additive values and costs, downward-closed feasibility, within-agent correlation, and independence across agents; it is tight in bilateral trade.
Summary by alphaXiv.
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