Efficiency and Truthfulness with Leontief Preferences. A Note on Two-agent Two-good Economies

In exchange economies where agents have private information about their preferences, strategy-proof and individually rational social choice functions are in general not efficient.We provide a restricted domain, namely the set of preferences representable by Leontief utility functions, where there exist mechanisms which are strategy-proof, efficient and individually rational. In two-agent, two-good economies we are able to provide an even stronger result.We characterize the class of efficient and individually rational social choice functions, which are fully implementable in truthful strategies.