 Let them cheat!Rodrigo Velez and William Thomson Games and Economic Behavior, 2012, vol. 75, issue 2, 948-963 Abstract: We consider the problem of fairly allocating a bundle of infinitely divisible goods among a group of agents with “classical” preferences. We propose to measure an agentʼs “sacrifice” at an allocation by the size of the set of feasible bundles that the agent prefers to her consumption. As a solution, we select the allocations at which sacrifices are equal across agents and this common sacrifice is minimal. We then turn to the manipulability of this solution. In the tradition of Hurwicz (1972), we identify, under some mild assumptions on preferences, the equilibrium allocations of the manipulation game associated with this solution when all commodities are normal: for each preference profile, each equal-division constrained Walrasian allocation is an equilibrium allocation; conversely, each equilibrium allocation is equal-division constrained Walrasian. Furthermore, we show that if normality of goods is dropped, then equilibrium allocations may not be equal-division constrained Walrasian. Keywords: Equal-sacrifice solution; Manipulation game; Equal-division Walrasian solution (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:75:y:2012:i:2:p:948-963 DOI: 10.1016/j.geb.2012.01.001 Access Statistics for this article Games and Economic Behavior is currently edited by E. Kalai More articles in Games and Economic Behavior from Elsevier |
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