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Fair Divisions as Attracting Nash Equilibria of Simple Games

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1725-6704
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EUI ECO; 2006/24
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GALBIATI, Marco, Fair Divisions as Attracting Nash Equilibria of Simple Games, EUI ECO, 2006/24 - https://hdl.handle.net/1814/6092
Abstract
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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