Collective Rationality and Monotone Path Division Rules

John Stovall ()

No 270424, Economic Research Papers from University of Warwick - Department of Economics

Abstract: We impose the axiom Independence of Irrelevant Alternatives on division rules for the conflicting claims problem. With the addition of Consistency and Resource Monotonicity, this characterizes a family of rules which can be described in three different but intuitive ways. First, a rule is identified with a fixed monotone path in the space of awards, and for a given claims vector, the path of awards for that claims vector is simply the monotone path truncated by the claims vector. Second, a rule is identified with a set of parametric functions indexed by the claimants, and for a given claims problem, each claimant receives the value of his parametric function at a common parameter value, but truncated by his claim. Third, a rule is identified with an additively separable, strictly concave social welfare function, and for a given claims problem, the amount awarded is the maximizer of the social welfare function subject to the constraint of choosing a feasible award. This third way of describing the family of rules is similar to Lensberg’s (1987) solution for bargaining problems applied to conflicting claims problems.

Keywords: Financial; Economics (search for similar items in EconPapers)
Pages: 27
Date: 2014-01-08
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Citations: View citations in EconPapers (20)

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Related works:
Journal Article: Collective rationality and monotone path division rules (2014)
Working Paper: Collective Rationality and Monotone Path Division Rules (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:270424

DOI: 10.22004/ag.econ.270424

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