From the bankruptcy problem and its Concede-and-Divide solution to the assignment problem and its Fair Division solution
Christian Trudeau ()
Games and Economic Behavior, 2018, vol. 108, issue C, 225-238
We revisit two classic problems: the assignment problem, in which matched pairs of agents create value, and the bankruptcy problem, in which we need to share an endowment among agents with conflicting claims. Since Core Selection constrains us to exactly divide the value created by matched agents, the assignment problem corresponds to multiple two-player bankruptcy problems. From this we obtain equivalence between the Concede-and-Divide (Aumann and Maschler, 1985) sharing method for the bankruptcy problem and the Fair Division solution (Thompson, 1981) for the assignment problem.
Keywords: Assignment problems; Bankruptcy problems; Core; Fair division; Concede-and-divide; Minimal rights (search for similar items in EconPapers)
JEL-codes: C71 D63 (search for similar items in EconPapers)
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Working Paper: From the bankruptcy problem and its Concede-and-Divide solution to the assignment problem and its Fair Division solution (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:108:y:2018:i:c:p:225-238
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