Date of Completion

Spring 5-12-2013

Thesis Advisor(s)

Mikhael Shor

Honors Major

Economics

Disciplines

Economics | Economic Theory

Abstract

The exact consensual and impartial division function by DeClippel et al (2008) offers a procedure for dividing a fixed award among partners. The peer evaluation mechanism proposed by DeClippel et al (2008) offers participating partners incentives to tell the truth. This paper examines and demonstrates that, when agents form at most one coalition and report wrong values of the relative shares, they capture the total amount of money being divided and their share improves by exactly the same percentage. When multiple coalitions emerge, the division function fails to assign payoffs to each partner. This paper also includes a discussion of possible ways including monitor hiring and changing aggregator to mitigate such collusion among agents.

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