Biung-Ghi Ju (Department of Economics, The University of Kansas) Eiichi Miyagawa (Department of Economics, Columbia University) Toyotaka Sakai (Department of Economics, University of Rochester)
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This paper studies the problem of allocating divisible resources among agents based on their characteristics. A simple example is the bankruptcy problem, which allocates the liquidation value of a bankrupted firm to creditors based on their claims. By allowing agents' characteristics to be multi-dimensional and varying the meaning of variables in the model, our model subsumes a number of existing and new alloca- tion problems, such as the problems of cost sharing, social choice under transferable utilities, income redistribution, bankruptcy with multiple assets, probability updat- ing, and probability aggregation. We characterize allocation rules under which no group of agents can increase the total amount they receive by transferring their characteristics within the group. A number of existing and new results in specific problems are obtained as corollaries.
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Length: 30 pages Date of creation: Dec 2003 Date of revision:
Aug 2005 Publication status: Forthcoming in Journal of Economic Theory Handle: RePEc:kan:wpaper:200307
Find related papers by JEL classification: C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games D30 - Microeconomics - - Distribution - - - General D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion
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[Downloadable!]
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