Core Rationalizability in Two-Agent Exchange Economies

We provide a characterization of selection correspondences in two-person exchange economies that can be core rationalized in the sense that there exists a preference profile with some standard properties that generates the observed choices as the set of core elements of the economy for any given initial endowment vector. The approach followed in this paper deviates from the standard rational choice model in that a rationalization in terms of a profile of individual orderings rather than in terms of a single individual or social preference relation is analyzed.

Fair Production and Allocation of an Excludable Nonrival Good

We study fairness in economies with one private good and one partially excludable nonrival good. A social ordering function determines for each profile of preferences an ordering of all conceivable allocations. We propose the following Free Lunch Aversion condition: if the private good contributions of two agents consuming the same quantity of the nonrival good have opposite signs, reducing that gap improves social welfare. This condition, combined with the more standard requirements of Unanimous Indifference and Responsiveness, delivers a form of welfare egalitarianism in which an agent's welfare at an allocation is measured by the quantity of the nonrival good that, consumed at no cost, would leave her indifferent to the bundle she is assigned.

On Demand Responsiveness in Additive Cost Sharing

We propose two new axioms of demand responsiveness for additive cost sharing with variable demands. Group Monotonicity requires that if a group of agents increase their demands, not all of them pay less. Solidarity says that if agent i demands more, j should not pay more if k pays less. Both axioms are compatible in the partial responsibility theory postulating Strong Ranking, i.e., the ranking of cost shares should never contradict that of demands. The combination of Strong Ranking , Solidarity and Monotonicity characterizes the quasi-proportional methods, under which cost shares are proportional to 'rescaled' demands. The alternative full responsibility theory is based on Separability, ruling out cross-subsidization when costs are additively separable. Neither the Aumann-Shapley nor the Shapley-Shubik method is group monotonic. On the otherhand, convex combinations of "nearby" fixed-path methods are group-monotonic: the subsidy-free serial method is the main example. No separable method meets Solidarity, yet restricting the axiom to submodular (or supermodular) cost functions leads to a characterization of the fixed-flow methods, containing the Shapley-Shubik and serial methods.

Sharing the cost of a public good under nonnegativity constraints

We study the construction of a social ordering function for the case of a public good financed by contributions from the population, and we extend the analysis of Maniquet and Sprumont (2004) to the case when contributions cannot be negative, i.e. agents cannot receive subsidies from the others.social ordering, public good, maximin

Ordinally consistent tournament solutions

A set ranking method assigns to each tournament on a given set an ordering of the subsets of that set. Such a method is consistent if (i) the items in the set are ranked in the same order as the sets of items they beat and (ii) the ordering of the items fully determines the ordering of the sets of items. We describe two consistent set ranking methods

Welfare Egalitarianism in Non-Rival Environments

We study equity in economies where a set of agents commonly own a technology producing a non-rival good from their private contributions. A social ordering function associates to each economy a complete ranking of the allocations. We build social ordering functions satisfying the property that individual welfare levels exceeding a legitimate upper bound should be reduced. Combining that property with efficiency and robustness properties with respect to changes in the set of agents, we obtain a kind of welfare egalitarianism based on a constructed numerical representation of individual preferences.

Responsibility and Cross-Subsidization in Cost Sharing

We propose two axiomatic theories of cost sharing with the common premise that individual demands are comparable, though perhaps different, commodities, and that agents are responsible for their own demand. Under partial responsibility the agents are not responsible for the asymmetries of the cost function: two agents consuming the same amount of output always pay the same price; this holds true under full responsibility only if the cost function is symmetric in all individual demands. If the cost function is additively separable, each agent pays his/her stand alone cost under full responsibility; this holds true under partial responsibility only if, in addition, the cost function is symmetric. By generalizing Moulin and Shenker.s (1999) Distributivity axiom to cost- sharing methods for heterogeneous goods, we identify in each of our two theories a different serial method. The subsidy-free serial method (Moulin, 1995) is essentially the only distributive method meeting Ranking and Dummy. The cross-subsidizing serial method (Sprumont, 1998) is the only distributive method satisfying Separability and Strong Ranking. Finally, we propose an alternative characterization of the latter method based on a strengthening of Distributivity.

«Constrained-optimal strategy-proof assignment: beyond the groves mechanisms»

A single object must be allocated to at most one of n agents. Money transfers are possible and preferences are quasilinear. We offer an explicit description of the individually rational mechanisms which are Pareto-optimal in the class of feasible, strategy-proof, anonymous and envy-free mechanisms. These mechanisms form a one-parameter infinite family; the Vickrey mechanism is the only Groves mechanism in that family

Paretian Quasi-Orders: Two Agents

We characterize Paretian quasi-orders in the two-agent continuous case.Nous caractérisons les ordres partiels parétiens pour le cas de deux agents et d'un continuum de choix