Abstract: Different parameter space is discussed under the influence of the control variable chosen by the mechanism designer. The space would be different constraint to each agent and different mechanism has its implementation condition based on Bayesian equilibrium. The sufficient and necessary condition of dual equivalent mechanism is presented. As an application of this study, the efficiency and welfare of China's land auction mechanisms are compared under truth-telling implementation. The result shows that choosing limited housing price auction or limited land price auction was dual equivalent when the government revenue is maximized. The balance between the government revenue and consumer surplus depends on the comparison between the efficiency of the market mechanism and non-market mechanism. There is a tradeoff between the profit of developer and consumer surplus, but the social welfare cannot be improved by truth-telling implementation.

Key words: mechanism design, land auction, Bayesian equilibrium, implementation, truth-telling