Two-player incentive compatible mechanisms are affine maximizers

Bo Lin, Ngoc Mai Tran

Abstract: In mechanism design, for a given type space, there may be incentive compatible outcome functions which are not affine maximizers. Using tools from linear algebra and tropical geometry, we prove that for two-player games on a discrete type space, any given outcome function can be turned into an affine maximizer through a nontrivial perturbation of the type space. Furthermore, our theorems are the strongest possible in this setup.