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Priority classes and weighted constrained equal awards rules for the claims problem

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  • Flores-Szwagrzak, Karol

Abstract

We revisit the “claims problem” (O'Neill, 1982), where a group of individuals have claims on a resource but there is not enough of it to honor all of the claims. We characterize the rules satisfying three well-known invariance axioms: consistency, composition up, and claims truncation invariance. They are priority-augmented versions of the standard weighted constrained equal awards rules, also known as weighted gains methods (Moulin, 2000): individuals are sorted into priority classes; the resource is distributed among the individuals in the first priority class using a weighted constrained equal awards rule; if some of the resource is left over, then it is distributed among the individuals in the second priority class, again using a weighted constrained equal awards rule; the distribution carries on in this way until the resource is exhausted. Our characterization extends to a generalized version of the claims problem where there are multiple divisible and indivisible resources and individuals have claims on each of these.

Suggested Citation

  • Flores-Szwagrzak, Karol, 2015. "Priority classes and weighted constrained equal awards rules for the claims problem," Journal of Economic Theory, Elsevier, vol. 160(C), pages 36-55.
  • Handle: RePEc:eee:jetheo:v:160:y:2015:i:c:p:36-55
    DOI: 10.1016/j.jet.2015.08.008
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. William Thomson, 2015. "For claims problems, compromising between the proportional and constrained equal awards rules," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 60(3), pages 495-520, November.
    2. Csoka, Péter & Herings, P. Jean-Jacques, 2017. "An Axiomatization of the Proportional Rule in Financial Networks," Research Memorandum 001, Maastricht University, Graduate School of Business and Economics (GSBE).
    3. Patrick Harless, 2017. "Endowment additivity and the weighted proportional rules for adjudicating conflicting claims," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 63(3), pages 755-781, March.
    4. repec:eee:matsoc:v:90:y:2017:i:c:p:43-55 is not listed on IDEAS
    5. Herlitz, Anders & Horan, David, 2016. "Measuring needs for priority setting in healthcare planning and policy," Social Science & Medicine, Elsevier, vol. 157(C), pages 96-102.
    6. repec:spr:annopr:v:254:y:2017:i:1:d:10.1007_s10479-017-2455-x is not listed on IDEAS
    7. René Brink & Juan D. Moreno-Ternero, 2017. "The reverse TAL-family of rules for bankruptcy problems," Annals of Operations Research, Springer, vol. 254(1), pages 449-465, July.
    8. William Thomson, 2015. "For claims problems, another compromise between the proportional and constrained equal awards rules," RCER Working Papers 592, University of Rochester - Center for Economic Research (RCER).

    More about this item

    Keywords

    Consistency; Composition up; Claims truncation invariance;

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - 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

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