A strategic justification of the Talmud rule based on lower and upper bounds

We follow the Nash program to provide a new strategic justification of the Talmud rule in bankruptcy problems. The design of our game is based on a focal axiomatization of the rule, which combines consistency with meaningful lower and upper bounds to all creditors. Our game actually considers bilate...

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Bibliographic Details
Published in:International journal of game theory 2020-12, Vol.49 (4), p.1045-1057
Main Authors: Moreno-Ternero, Juan D., Tsay, Min-Hung, Yeh, Chun-Hsien
Format: Article
Language:English
Subjects:
Axioms
Bankruptcy
Behavioral/Experimental Economics
Consistency
Creditors
Economic Theory/Quantitative Economics/Mathematical Methods
Economics
Economics and Finance
Game Theory
Justification
Negotiations
Operations Research/Decision Theory
Original Paper
Social and Behav. Sciences
Talmud
Upper bounds
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Summary:We follow the Nash program to provide a new strategic justification of the Talmud rule in bankruptcy problems. The design of our game is based on a focal axiomatization of the rule, which combines consistency with meaningful lower and upper bounds to all creditors. Our game actually considers bilateral negotiations, inspired by those bounds, which are extended to an arbitrary number of creditors, by means of consistency.
ISSN:0020-7276
1432-1270
DOI:10.1007/s00182-020-00727-z