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What is “Incentive Compatibility”?

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Classification in the Information Age

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Abstract

In spite of its overwhelming success in theory and practice the shortcomings of the neo-classical approach in finance are well-known. It cannot explain many important phenomena, so that serious doubts on the generated positive results arise. Consequently interest shifts towards the neo-institutional framework, but it is quite difficult to judge the relevance of its results, since they are very sensitive to assumptions and details of the models. For instance, solution mechanisms for (financial) problems should be “incentive compatible”. This describes an idea and not an exact definition. There exists a variety of operationalizations, and due to the mentioned lack of robustness some sort of classification of models turns out to be an important task for future research.

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Author information

Authors and Affiliations

  1. Fachgebiet Finanzwirtschaft/Investition, Technische Universität Ilmenau, D-98684, Ilmenau, Germany

    R. Trost

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  1. R. Trost
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Editor information

Editors and Affiliations

  1. Institut für Entscheidungstheorie und Unternehmensforschung, University of Karlsruhe, Postfach 69 80, D-76128, Karlsruhe, Germany

    Wolfgang Gaul

  2. Lehrstuhl für BWL, insb. Finanzwirtschaft, University of Dresden, Mommsenstr. 13, D-01062, Dresden, Germany

    Hermann Locarek-Junge

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© 1999 Springer-Verlag Berlin · Heidelberg

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Trost, R. (1999). What is “Incentive Compatibility”?. In: Gaul, W., Locarek-Junge, H. (eds) Classification in the Information Age. Studies in Classification, Data Analysis, and Knowledge Organization. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-60187-3_52

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  • DOI: https://doi.org/10.1007/978-3-642-60187-3_52

  • Publisher Name: Springer, Berlin, Heidelberg

  • Print ISBN: 978-3-540-65855-9

  • Online ISBN: 978-3-642-60187-3

  • eBook Packages: Springer Book Archive

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