Accounting for Needs in Cost Sharing

Etienne Billette de Villemeur and Justin Leroux

MPRA Paper from University Library of Munich, Germany

Abstract: Abstract We introduce basic needs in cost-sharing problems so that agents with higher needs are not penalized, all the while holding them responsible for their consumption. We characterize axiomatically two families of cost-sharing rules, each favoring one aspect—compensation or responsibility—over the other. We also identify specific variants of those rules that protect small users from the cost externality imposed by larger users. Lastly, we show how one can implement these schemes with realistic informational assumptions; i.e., without making explicit interpersonal comparisons of needs and consumption.

Keywords: Cost Sharing; Needs; Responsibility; Liberal Egalitarianism (search for similar items in EconPapers)
JEL-codes: D63 (search for similar items in EconPapers)
Date: 2016-08
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https://mpra.ub.uni-muenchen.de/118902/1/MPRA_paper_118902.pdf revised version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:73434

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