On Markovian Cake Sharing Problems
Pure strategy Markov perfect equilibria (MPE) in dynamic cake sharing problems are analyzed. Each player chooses under perfect information how much to eat from the current cake and how much to leave to the next period. The left over cake grows according to a given growth function. With linear utilities and strictly concave increasing growth function the only symmetric equilibrium with continuous strategies is the trivial equilibrium in which a player eats the whole cake whenever it is his turn to move. This is quite different than in the corresponding single person decision problem (or at a social optimum) where the cake grows from small initial values towards the steady state. A non-trivial equilibrium with a positive steady state exist in the game. In such an equilibrium strategies cannot be continuous. When utilities are concave and the growth function is linear, a nontrivial MPE with a positive steady state may not exist.
|Date of creation:||Mar 2012|
|Contact details of provider:|| Postal: Rehtorinpellonkatu 3, FIN-20500 TURKU|
Phone: +358 2 333 51
Web page: http://ace-economics.fi
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Marco Battaglini & Salvatore Nunnari & Thomas Palfrey, 2011. "The Free Rider Problem: a Dynamic Analysis," Working Papers 1354, Princeton University, Department of Economics, Econometric Research Program..
When requesting a correction, please mention this item's handle: RePEc:tkk:dpaper:dp72. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Aleksandra Maslowska)
If references are entirely missing, you can add them using this form.