This article examines the extent to which utilitarian social welfare maximization results in an egalitarian outcome for the classic n-agent cake-cutting problem when the agents are characterized by ...heterogenous subsistence needs as well as by heterogeneous tastes. It is shown that utilitarian social welfare maximization results in surplus-egalitarianism---i.e., first meeting needs, then equally dividing the remaining cake---when tastes are uncertain but needs are known, can be met, and are required to be met by prior restriction. If the meeting of needs is not imposed as a lexicographically prior principal of fairness, however, then---due to the fundamental non-concavity of individual agent utility functions resulting from the introduction of subsistence needs---utilitarian social welfare maximization requires that agents with high subsistence needs be allowed to die with zero shares as a matter of general policy. Moreover, when needs and tastes are both uncertain, an egalitarian allocation only results if the meaning of subsistence needs is suitably weakened to a poverty line definition. Annotated pointers to related work can be accessed here: http://www.econ.iastate.edu/tesfatsi/dehome.htm
The article is devoted to the approaches that can be applied in the distribution of Arctic resources between the main reference countries of this region. The objective economic nature of the problems ...that arise in this region makes it possible to characterize them as a competition of claims for a limited and potentially dynamically changing resource. At a formal level, this problem has a general nature and it is typical for many areas of modern economy. At the same time, it is impossible to deny its specifics, which imposes significant restrictions on possible methods of solution. In recent years, problems in the sphere of interstate cooperation under conditions of limited resources have significantly increased. In such a situation, scientific and practical research in the field of mechanisms for regulating the relations between the parties (economic entities) becomes interesting. In analyzing the mechanisms of distribution of limited resources, one can use the theory of cooperative games, mathematical models of resource rationing, as well as works on the study of problems of equitable distribution (s.c. Fair Divisions). In the framework of such tasks, the range of applicants for limited resources can be limited to countries or regions directly adjacent. The process can be include of “external players” who have sufficient investment potential. The subsequent development and analysis of the problems of regulating intercountry interaction are associated with mathematical formalization. Such formalization presupposes a description of the situation of competitive interaction between countries in the form of a stochastic cooperative game. An analysis of possible concepts for the solution of this game will lead to meaningful conclusions about specific schemes (mechanisms) of rationing.
We consider the problem of allocating a finite number of divisible homogeneous goods to N = 2 individuals, in a way which is both envy-free and Pareto optimal. Building on Thomson (2005 Games and ...Economic Behavior), a new simple mechanism is presented here with the following properties: a) the mechanism fully implements the desired divisions, i.e. for each preference profile the set of equilibrium outcomes coincides with the set of fair divisions; b) the set of equilibria is a global attractor for the best-reply dynamics. Thus, players myopically adapting their strategies settle down in an fair division. The result holds even if mixed strategies are used.
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