Efficient incentive compatible economies are perfectly competitive (Q1290837)

Consider an exchange economy with a finite number of traders. Let \(M\) be an efficient, anonymous, and continuous mechanism on such an economy. The main result of the paper is that \(M\) is incentive compatible in dominant strategies if and only if \(M\) is perfectly competitive. As is well known, existence is an issue -- perfect competition is almost always incompatible with a finite number of traders. The paper explores this issue closely, showing that perfectly competitive mechanisms are non-generic (but non-vacuous) with a finite number of traders.