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Lower Bounds Rule!

Date Added: Nov 2010
Format: PDF

The authors propose two axioms that introduce lower bounds into resource monotonicity requirements for rules for the problem of adjudicating conflicting claims suppose the amount to divide increases. The first axiom requires that two claimants whose lower bound changes equally experience an equal change in awards. The second axiom requires that extra resources are divided only among those claimants who experience a strictly positive change in their lower bound. The authors show that, in the two-claimant case, Concede-and-Divide is the only rule that satisfies both axioms when the axioms are defined over a large set of lower bounds that include the minimal rights lower bound and the secured lower bound.