A mechanism is called incentive-compatible (IC) if every participant can achieve the best outcome to themselves just by acting according to their true preferences.^: 225

There are several different degrees of incentive-compatibility:

• The stronger degree is dominant-strategy incentive-compatibility (DSIC).^: 415 It means that truth-telling is a weakly-dominant strategy, i.e. you fare best or at least not worse by being truthful, regardless of what the others do. In a DSIC mechanism, strategic considerations cannot help any agent achieve better outcomes than the truth; hence, such mechanisms are also called strategyproof^{: 244, 752} or truthful.^: 415 (See Strategyproofness)
• A weaker degree is Bayesian-Nash incentive-compatibility (BNIC).^: 416 It means that there is a Bayesian Nash equilibrium in which all participants reveal their true preferences. I.e, if all the others act truthfully, then it is also best or at least not worse for you to be truthful.^: 234

Every DSIC mechanism is also BNIC, but a BNIC mechanism may exist even if no DSIC mechanism exists.

Typical examples of DSIC mechanisms are majority voting between two alternatives, and second-price auction.

Typical examples of a mechanisms that are not DSIC are plurality voting between three or more alternatives and first-price auction.