The Becker-DeGroot-Marschak mechanism is not necessarily incentive compatible, even for non-random goods

This paper uses results from [Kami, E., Safra, Z., 1987. Preference reversals and the observability of preferences by experimental methods, Econometrica 55, 675-685] and [Kami, E., 1989. Generalized expected utility analysis of multivariate risk aversion, International Economic Review 30, 297-305] to show that the Becker-DeGroot-Marschak mechanism is not always incentive compatible, even when the item to be valued involves no uncertainty, contrary to several recent assertions. (c) 2006 Elsevier B.V. All rights reserved.