Compensation and sacrifice in the probabilistic rationing of indivisible units

Ricardo Martinez () and Juan Moreno-Ternero

European Journal of Operational Research, 2022, vol. 302, issue 2, 740-751

Abstract: We consider the problem of randomly allocating indivisible units of a resource among agents with conflicting claims on the resource. An axiom reflecting a principle of compensation allows us to characterize the focal probabilistic uniform awards rule. A dual axiom reflecting a principle of sacrifice allows us to characterize the (dual) probabilistic uniform losses rule. The combination of two (other) axioms reflecting both principles (of compensation and sacrifice) allows us to characterize the (compromise) probabilistic concede-and-divide in the two-agent case. There is, however, no consistent extension of this rule to the general case of an arbitrary number of agents.

Keywords: Game theory; Resource allocation; Axioms; Probabilistic; Discrete goods (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Compensation and sacrifice in the probabilistic rationing of indivisible units (2022)
Working Paper: Compensation and sacrifice in the probabilistic rationing of indivisible units (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ejores:v:302:y:2022:i:2:p:740-751

DOI: 10.1016/j.ejor.2021.12.038

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