Understanding Mechanism Design—Part 2 of 3: The Vickrey-Clarke-Groves Mechanism

As we saw in the first part of this short series, a mechanism design problem involves engineering the rules of a game so that, if participants then behave rationally in the game (by choosing strategies that maximize their expected utility, for example), then the result will satisfy some desired property. So far, however, we have said nothing about what these desirable properties might be, or what mechanisms might achieve them. Here, we will dig into these two issues in a little more detail.