Fair and efficient division through unanimity bargaining when claims are subjective

Anita Gantner, Kristian Horn and Rudolf Kerschbamer

Journal of Economic Psychology, 2016, vol. 57, issue C, 56-73

Abstract: In a subjective claims problem several partners have conflicting perceptions on how a jointly produced surplus should be divided fairly amongst them. In a large-scale experiment, we compare the fairness and efficiency of three unanimity bargaining procedures used to reach a consensus in a three-partner subjective claims problem. Under each procedure partners move sequentially, making alternating proposals. The procedures differ in whether they ask for a complete division proposal (Offer and Exit rule) or only for a proposal regarding the partner’s own fair share (Demand rule); and in whether partners have to accept the entire division proposal (Offer and Demand rule) or only their own share (Exit rule). For the fairness assessment partial and impartial fairness views are used and we find that the Offer rule performs best in terms of allocative fairness and no worse in terms of efficiency.

Keywords: Fair division; Subjective claims; Bargaining; Experiment (search for similar items in EconPapers)
JEL-codes: C91 D61 D63 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:joepsy:v:57:y:2016:i:c:p:56-73

DOI: 10.1016/j.joep.2016.09.004

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