Sharing a River
AbstractA group of agents located along a river have quasi-linear preferences over water and money. We ask how the water should be allocated and what money transfers should be performed. We are interested in efficiency, stability (in the sense of the core), and fairness (in a sense to be defined). We first show that the cooperative game associated with our problem is convex : its core is therefore large and easily described. Next, we propose the following fairness requirement : no group of agents should enjoy a welfare higher than what it could achieve in the absence of the remaining agents. We prove that only one welfare vector in the core satisfies this condition : it is the marginal contribution vector corresponding to the ordering of the agents along the river. We discuss how it could be decentralized or implemented.
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Bibliographic InfoPaper provided by Universite de Montreal, Departement de sciences economiques in its series Cahiers de recherche with number 2000-08.
Length: 18 pages
Date of creation: 2000
Date of revision:
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common orty resources; fair allocation; core;
Other versions of this item:
- Ambec, S. & Sprumont, Y., 2000. "Sharing a River," Papers 00-06, Laval - Recherche en Energie.
- Ambec, Stefan & Sprumont, Yves, 2000. "Sharing a River," Cahiers de recherche 0006, GREEN.
- Ambec, S. & Sprumont, Y., 2000. "Sharing a River," Cahiers de recherche 2000-08, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
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UFAE and IAE Working Papers
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