Problem Solving Assignment Result Of Bdp

Author

Abstract

We study the problem of assigning indivisible goods to individuals where each is to receive one good. To guarantee fairness in the absence of monetary compensation, we consider random assignments that individuals evaluate according to first order stochastic dominance (sd). In particular, we find that solutions that guarantee sd-no-envy (e.g. the Probabilistic Serial) are incompatible even with the weak sd-core from equal division. Solutions on the other hand that produce assignments in the strong sd-core from equal division (e.g. Hylland and Zeckhauser’s Walrasian Equilibria from Equal Incomes) are incompatible with the strong sd-equal-division-lower-bound. As an alternative, we present a solution, based on Walrasian equilibria, that is sd-efficient, in the weak sd-core from equal division and satisfies the strong sd-equal-division-lower-bound.

Suggested Citation

  • Christian Basteck, 2016. "Fair solutions to the random assignment problem," Working Papers 2016001, Berlin Doctoral Program in Economics and Management Science (BDPEMS).
  • Handle: RePEc:bdp:wpaper:2016001

    Listed:
    • Christian Basteck

      () (Technische Universitaet Berlin)

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