2. Suppose that the government used the Groves mechanism and undertook a public project. The mechanism...
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2. Suppose that the government used the Groves mechanism and undertook a public project. The mechanism generated a deficit d, and the government will finance it through a special lump-sum tax of d/n for each individual. If agents anticipate such a tax, will it affect the truth-revealing property of the Groves mechanism? (6 points) 2. Suppose that the government used the Groves mechanism and undertook a public project. The mechanism generated a deficit d, and the government will finance it through a special lump-sum tax of d/n for each individual. If agents anticipate such a tax, will it affect the truth-revealing property of the Groves mechanism? (6 points)
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The answer is yes it will affect the truthrevealing property of the Groves mechanism If agents antic... View the full answer
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