Solidarity in Choosing a Location on a Cycle
Series/Report no.Cahier de recherche #2006-06
- Location Theory
- [JEL:C79] Mathematical and Quantitative Methods - Game Theory and Bargaining Theory - Other
- [JEL:D71] Microeconomics - Analysis of Collective Decision-Making - Social Choice; Clubs; Committees; Associations
- [JEL:C79] Mathématiques et méthodes quantitatives - Théorie des jeux et négociation - Divers
- [JEL:D71] Microéconomie - Analyse de prise de décision collective - Choix social, clubs, comités
We study the implications of two solidarity conditions on the efficient location of a public good on a cycle, when agents have single-peaked, symmetric preferences. Both conditions require that when circumstances change, the agents not responsible for the change should all be affected in the same direction: either they all gain or they all loose. The first condition, population-monotonicity, applies to arrival or departure of one agent. The second, replacement-domination, applies to changes in the preferences of one agent. Unfortunately, no Pareto-efficient solution satisfies any of these properties. However, if agents’ preferred points are restricted to the vertices of a small regular polygon inscribed in the circle, solutions exist. We characterize them as a class of efficient priority rules.
GORDON, Sidartha, «Solidarity in Choosing a Location on a Cycle», Cahier de recherche #2006-06, Département de sciences économiques, Université de Montréal, 2006, 34 pages.