Abstract of Sincere and sophisticated players in the envy-free allocation problem

We consider the manipulation of envy-free solutions for the allocation of indivisible goods and money when some agents are sincere, i.e., unconditionally report their true preferences, and the other are strategic. We show that strategic agents non-cooperatively coordinate on the envy-free allocations that are not Pareto dominated for them by any other envy-free allocation. Independently of the envy-free solution that is operated: (i) a "pessimistic" agent, i.e., an agent who expects his worst-case scenario equilibrium payoff, has no welfare loss if she commits to be sincere, and (ii) an "optimistic" agent, i.e., an agent who expects his best-case equilibrium payoff, generically has an incentive to be strategic. This suggests that in our environment dominance of truthful revelation is generically unrelated with an agent's incentive to be sincere.

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