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Fair and efficient division through unanimity bargaining when claims are subjective

Listed author(s):
  • Gantner, Anita
  • Horn, Kristian
  • Kerschbamer, Rudolf

In a subjective claims problem several partners have conflicting perceptions on how a jointly produced surplus should be divided fairly amongst them. In a large-scale experiment, we compare the fairness and efficiency of three unanimity bargaining procedures used to reach a consensus in a three-partner subjective claims problem. Under each procedure partners move sequentially, making alternating proposals. The procedures differ in whether they ask for a complete division proposal (Offer and Exit rule) or only for a proposal regarding the partner’s own fair share (Demand rule); and in whether partners have to accept the entire division proposal (Offer and Demand rule) or only their own share (Exit rule). For the fairness assessment partial and impartial fairness views are used and we find that the Offer rule performs best in terms of allocative fairness and no worse in terms of efficiency.

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File URL: http://www.sciencedirect.com/science/article/pii/S0167487016300770
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Article provided by Elsevier in its journal Journal of Economic Psychology.

Volume (Year): 57 (2016)
Issue (Month): C ()
Pages: 56-73

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Handle: RePEc:eee:joepsy:v:57:y:2016:i:c:p:56-73
DOI: 10.1016/j.joep.2016.09.004
Contact details of provider: Web page: http://www.elsevier.com/locate/joep

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