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Lorenz and lexicographic maximal allocations for bankruptcy problems

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This paper investigates the use of egalitarian criteria to select allocations in bankruptcy problems. In our work, we characterize the sets of Lorenz maximal elements for these problems. We show that the allocation selected by the Proportional Rule is the only allocation that belongs to all these Lorenz maximal sets. We prove that the Talmud Rule selects the lexicographic maximal element within a certain set. We introduce and analyze a new sharing rule for bankruptcy problems that shares strong similarities with the Talmud Rule.

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  • Javier Arin & Juan Miguel Benito, 2012. "Lorenz and lexicographic maximal allocations for bankruptcy problems," Documentos de Trabajo - Lan Gaiak Departamento de Economía - Universidad Pública de Navarra 1202, Departamento de Economía - Universidad Pública de Navarra.
    • Handle: RePEc:nav:ecupna:1202
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    1. Juan Moreno-Ternero & Antonio Villar, 2006. "The TAL-Family of Rules for Bankruptcy Problems," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 27(2), pages 231-249, October.
    2. Javier Arin & Juan Miguel Benito, 2010. "Claim Problems and Egalitarian Criteria," Documentos de Trabajo - Lan Gaiak Departamento de Economía - Universidad Pública de Navarra 1001, Departamento de Economía - Universidad Pública de Navarra.
    3. Toru Hokari & William Thomson, 2003. "Claims problems and weighted generalizations of the Talmud rule," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 21(2), pages 241-261, March.
    4. Hanan Luss, 1999. "On Equitable Resource Allocation Problems: A Lexicographic Minimax Approach," Operations Research, INFORMS, vol. 47(3), pages 361-378, June.
    5. William Thomson, 2012. "Lorenz rankings of rules for the adjudication of conflicting claims," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 50(3), pages 547-569, August.
    6. Thomson, William, 2015. "Axiomatic and game-theoretic analysis of bankruptcy and taxation problems: An update," Mathematical Social Sciences, Elsevier, vol. 74(C), pages 41-59.
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