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Sharing an increase of the rent fairly

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  • Rodrigo A. Velez

    (Texas A&M University, Department of Economics)

Abstract

We characterize the family of non-contestable budget- monotone rules for the allocation of objects and money as those obtained by maximizing a min social welfare function among all non-contestable allocations. We provide three additional seemingly independent approaches to construct these rules. We present three applications of this characterization. First, we show that one can "rectify" any non-contestable rule without losing non-contestability. Second, we characterize the preferences that admit, for each budget, a non-contestable allocation satisfying a minimal or maximal individual consumption of money constraint. Third, we study continuity properties of the non-contestable correspondence.

Suggested Citation

  • Rodrigo A. Velez, 2015. "Sharing an increase of the rent fairly," Working Papers 20151201-001, Texas A&M University, Department of Economics.
    • Handle: RePEc:txm:wpaper:20151201-001
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    References listed on IDEAS

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    1. Nicolò, Antonio & Velez, Rodrigo A., 2017. "Divide and compromise," Mathematical Social Sciences, Elsevier, vol. 90(C), pages 100-110.
    2. Moore, John & Repullo, Rafael, 1988. "Subgame Perfect Implementation," Econometrica, Econometric Society, vol. 56(5), pages 1191-1220, September.
    3. Fujinaka, Yuji & Wakayama, Takuma, 2015. "Maximal manipulation of envy-free solutions in economies with indivisible goods and money," Journal of Economic Theory, Elsevier, vol. 158(PA), pages 165-185.
    4. Gabrielle Demange & Ahmet Alkan & David Gale, 1991. "Fair Allocation of Indivisible Goods and Money and Criteria of Justice," Post-Print halshs-00670945, HAL.
    5. Tadenuma, Koichi & Thomson, William, 1991. "No-Envy and Consistency in Economies with Indivisible Goods," Econometrica, Econometric Society, vol. 59(6), pages 1755-1767, November.
    6. Svensson, Lars-Gunnar, 1983. "Large Indivisibles: An Analysis with Respect to Price Equilibrium and Fairness," Econometrica, Econometric Society, vol. 51(4), pages 939-954, July.
    7. Svensson, Lars-Gunnar, 1987. "Erratum [Large Indivisibles: An Analysis with Respect to Price Equilibrium and Fairness]," Econometrica, Econometric Society, vol. 55(2), pages 489-489, March.
    8. Eric Maskin, 1999. "Nash Equilibrium and Welfare Optimality," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 66(1), pages 23-38.
    9. Velez, Rodrigo A., 2011. "Are incentives against economic justice?," Journal of Economic Theory, Elsevier, vol. 146(1), pages 326-345, January.
    10. William Thomson, 1983. "The Fair Division of a Fixed Supply Among a Growing Population," Mathematics of Operations Research, INFORMS, vol. 8(3), pages 319-326, August.
    11. , & , & ,, 2014. "Budget-balance, fairness and minimal manipulability," Theoretical Economics, Econometric Society, vol. 9(3), September.
    12. Velez, Rodrigo A., 2016. "Fairness and externalities," Theoretical Economics, Econometric Society, vol. 11(1), January.
    13. Varian, Hal R., 1974. "Equity, envy, and efficiency," Journal of Economic Theory, Elsevier, vol. 9(1), pages 63-91, September.
    14. Eric S. Maskin, 1987. "On the Fair Allocation of Indivisible Goods," Palgrave Macmillan Books, in: George R. Feiwel (ed.), Arrow and the Foundations of the Theory of Economic Policy, chapter 11, pages 341-349, Palgrave Macmillan.
    15. Moulin, Herve & Thomson, William, 1988. "Can everyone benefit from growth? : Two difficulties," Journal of Mathematical Economics, Elsevier, vol. 17(4), pages 339-345, September.
    16. Matthew O. Jackson, 2001. "A crash course in implementation theory," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 18(4), pages 655-708.
    17. Alkan, Ahmet & Demange, Gabrielle & Gale, David, 1991. "Fair Allocation of Indivisible Goods and Criteria of Justice," Econometrica, Econometric Society, vol. 59(4), pages 1023-1039, July.
    18. Thomson, William, 2012. "On The Axiomatics Of Resource Allocation: Interpreting The Consistency Principle," Economics and Philosophy, Cambridge University Press, vol. 28(3), pages 385-421, November.
    19. Tadenuma Koichi & Thomson William, 1995. "Games of Fair Division," Games and Economic Behavior, Elsevier, vol. 9(2), pages 191-204, May.
    20. Alkan, Ahmet, 1994. "Monotonicity and Envyfree Assignments," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 4(4), pages 605-616, May.
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    Cited by:

    1. Rodrigo A. Velez, 2017. "Equitable rent division," Working Papers 20170818-001, Texas A&M University, Department of Economics.
    2. Rodrigo A. Velez, 2022. "A polynomial algorithm for maxmin and minmax envy-free rent division on a soft budget," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 59(1), pages 93-118, July.
    3. Sheida Etemadidavan & Andrew J. Collins, 2021. "An Empirical Distribution of the Number of Subsets in the Core Partitions of Hedonic Games," SN Operations Research Forum, Springer, vol. 2(4), pages 1-20, December.
    4. Rodrigo A. Velez, 2019. "Expressive mechanisms for equitable rent division on a budget," Papers 1902.02935, arXiv.org, revised Apr 2020.
    5. Velez, Rodrigo A., 2023. "Equitable rent division on a soft budget," Games and Economic Behavior, Elsevier, vol. 139(C), pages 1-14.
    6. Nicolò, Antonio & Velez, Rodrigo A., 2017. "Divide and compromise," Mathematical Social Sciences, Elsevier, vol. 90(C), pages 100-110.

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    More about this item

    Keywords

    solidarity; allocation of objects and money; non contestable allocations;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General

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