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Estévez-Fernández, Arantza
Borm, Peter
Fiestras-Janeiro, M. Gloria
Year of Publication: 
Series/Report no.: 
Tinbergen Institute Discussion Paper 14-030/II
In this paper, we analyze bankruptcy problems with nontransferable utility (NTU) from a game theoretical perspective by redefining corresponding NTU-bankruptcy games in a tailor-made way. It is shown that NTU-bankruptcy games are both coalitional merge convex and ordinal convex. Generalizing the notions of core cover and compromise stability for transferable utility (TU) games to NTU-games, we also show that each NTU-bankruptcy game is compromise stable. Thus, NTU-bankruptcy games are shown to retain the two characterizing properties of TU-bankruptcy games: convexity and compromise stability. As a first example of a game theoretical NTU-bankruptcy rule, we analyze the NTU-adjusted proportional rule and show that this rule corresponds to the compromise value of NTU-bankruptcy games.
NTU-bankruptcy problem
NTU-bankruptcy game
Coalitional merge convexity
Ordinal convexity
Compromise stability
Core cover
Adjusted proportional rule
Document Type: 
Working Paper

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