Games 2013, 4(1), 21-37; doi:10.3390/g4010021
Article

An Equilibrium Analysis of Knaster’s Fair Division Procedure

Department of Economics, Finance, and Legal Studies, University of Alabama, Tuscaloosa, AL 35487, USA
Received: 19 October 2012; in revised form: 8 January 2013 / Accepted: 8 January 2013 / Published: 18 January 2013
(This article belongs to the Special Issue Mechanism Design)
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Abstract: In an incomplete information setting, we analyze the sealed bid auction proposed by Knaster (cf. Steinhaus (1948)). This procedure was designed to efficiently and fairly allocate multiple indivisible items when participants report their valuations truthfully. In equilibrium, players do not follow truthful bidding strategies. We find that, ex-post, the equilibrium allocation is still efficient but may not be fair. However, on average, participants receive the same outcome they would have received if everyone had reported truthfully—i.e., the mechanism is ex-ante fair.
Keywords: fair division; auction

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MDPI and ACS Style

Van Essen, M. An Equilibrium Analysis of Knaster’s Fair Division Procedure. Games 2013, 4, 21-37.

AMA Style

Van Essen M. An Equilibrium Analysis of Knaster’s Fair Division Procedure. Games. 2013; 4(1):21-37.

Chicago/Turabian Style

Van Essen, Matt. 2013. "An Equilibrium Analysis of Knaster’s Fair Division Procedure." Games 4, no. 1: 21-37.

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