Abstract:

I present a general framework for automated mechanism design on constrained design spaces when the outcomes of strategic interactions between the mechanism designer and participants are specified using a simulation. At the core of the framework lies a black-box stochastic optimization algorithm which guides the selection process of candidate mechanisms. I demonstrate the efficacy of such an approach using a series of applications to two-player design problems. A critical component of mechanism design based on simulations is an algorithm for approximately solving simulation- based games. I present several such algorithms, one of which is provably convergent, and experimentally assess their relative merits.