Mechanism design (sometimes called reverse game theory) is a field in game theory studying solution concepts for a class of private information games. The distinguishing features of these games are:
- that a game "designer" chooses the game structure rather than inheriting one
- that the designer is interested in the game's outcome
Such a game is called a "game of mechanism design" and is usually solved by motivating agents to disclose their private information. The 2007 Nobel Memorial Prize in Economic Sciences was awarded to Leonid Hurwicz, Eric Maskin, and Roger Myerson "for having laid the foundations of mechanism design theory".
Read more about Mechanism Design: Intuition
Famous quotes containing the words mechanism and/or design:
“The law isn’t justice. It’s a very imperfect mechanism. If you press exactly the right buttons and are also lucky, justice may show up in the answer. A mechanism is all the law was ever intended to be.”
—Raymond Chandler (1888–1959)
“Teaching is the perpetual end and office of all things. Teaching, instruction is the main design that shines through the sky and earth.”
—Ralph Waldo Emerson (1803–1882)