On characterizations of the probabilistic serial mechanism involving incentive and invariance properties.

This paper studies the problem of assigning n indivisible objects to n agents when each agent consumes one object and monetary transfers are not allowed. Bogomolnaia and Moulin (2001) proved that for n=3, the probabilistic serial mechanism is characterized by the three axioms of ordinal efficiency, envy-freeness, and weak strategy-proofness. We show that this characterization does not extend to problems of arbitrary size; in particular, it does not hold for any n≥5. A number of general characterizations of the probabilistic serial mechanism have been obtained in the recent literature by replacing weak strategy-proofness with various invariance axioms while retaining ordinal efficiency and envy-freeness. We show that weak strategy-proofness is in fact logically independent of all invariance axioms used in these characterizations.