Fairness and efficiency for allocations with participation constraints

A-Tier
Journal: Journal of Economic Theory
Year: 2021
Volume: 195
Issue: C

Authors (3)

Echenique, Federico (University of California-Berke...) Miralles, Antonio (not in RePEc) Zhang, Jun (not in RePEc)

Score contribution per author:

1.341 = (α=2.01 / 3 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We propose a notion of fairness for allocation problems in which different agents may have different reservation utilities, stemming from different outside options, or property rights. Fairness is usually understood as the absence of envy, but this can be incompatible with reservation utilities. It is possible that Alice's envy of Bob's assignment cannot be remedied without violating Bob's participation constraint. Instead, we seek to rule out justified envy, defined as envy for which a remedy would not violate any agent's participation constraint. We show that fairness, meaning the absence of justified envy, can be achieved together with efficiency and individual rationality. We introduce a competitive equilibrium approach with price-dependent incomes obtaining the desired properties.

Technical Details

RePEc Handle
repec:eee:jetheo:v:195:y:2021:i:c:s0022053121000910
Journal Field
Theory
Author Count
3
Added to Database
2026-01-25