Friend-Based Ranking

Journal article: We analyze the design of a mechanism to extract a ranking of individuals according to a unidimensional characteristic, such as ability or need. Individuals, connected on a social network, only have local information about the ranking. We show that a planner can construct an ex post incentive compatible and efficient mechanism if and only if every pair of friends has a friend in common. We characterize the windmill network as the sparsest social network for which the planner can always construct a complete ranking.

Author(s)

Francis Bloch, Matthew Olckers

Journal
  • American Economic Journal: Microeconomics
Date of publication
  • 2022
Keywords JEL
D11 D82 D83 D85 O12 Z13
Pages
  • 176-214
Version
  • 1
Volume
  • 14