Convergence of VCG mechanism to ex-post Budget Balance in a Model of Land Acquisition
Sarkar S, 2018
Mathematical Social Sciences
We explore the effect of competition among a large number of sellers in a model of Land Acquisition. Sellers with one unit of land each are located at the nodes of a graph. Two sellers are contiguous if they are connected by an edge in the graph. The buyer realizes a positive value only if he can purchase plots that constitute a path of given length. We characterize conditions for different contiguity structures under which the VCG mechanism almost surely results in a budget surplus as the number of sellers become large.