Journal of Economic Theory and Econometrics: Journal of the Korean Econometric Society
Home About    Aims and Scope    Editorial Board Submit Archive Search
Journal of Economic Theory and Econometrics
JETEM/계량경제학보/計量經濟學報/JKES
Journal of the Korean Econometric Society

Strategy-Proof Risk Sharing for Uncertainty Averse Preferences

Vol.19, No.4, December , 61–74



  •   (Department of Economics, Korea University)

PDF
Abstract  

We consider a model of state-contingent goods allocation. Each agent has a set of beliefs, or priors, and evaluates an allocation according to the minimum expected utility over the set of priors. We study allocation rules that satisfy efficiency, individual rationality, and strategy-proofness (no one can benefit by misrepresenting his preferences). In the aggregate certainty case, the three axioms are compatible and we characterize the non-empty family of rules which contains both Walrasian and non-Walrasian rules. In the aggregate uncertainty case, we show in the 2-agent and 2-state case that the three axioms may or may not be compatible, depending on existence of a degenerate prior.


Keywords
   Risk sharing, Strategy-proofness, Uncertainty aversion, Maximin expected utility, Efficiency, Individual rationality

JEL classification codes
   C70, D70
Links

KCI
KES
SCOPUS
MathJax