Reallocation in mixed ownership economies with single-peaked preferences

Abstract

In the context of a mixed ownership economy consisting of agents with single-peaked preferences and individual endowments together with an outside obligation with the rest of the world, we study rules to reallocate the resources available to the agents involved. We show that the adaptation to our model of the uniform reallocation rule fulfills nice properties (obligation monotonicity, efficiency, consistency and replacement monotonicity) and that it is immune to strategic behavior in a very general way: it is a bribe-proof rule. A rule is bribe-proof if no group of agents can compensate one of its subgroups to misrepresent their characteristics (either preferences or endowments, or both at the same time) and, after an appropriate redistribution of their shares, each obtain a weakly preferred share and all agents in the misrepresenting subgroup obtain a strictly preferred share. Bribe-proofness includes as special cases known and widely studied non-manipulation properties such as strategy-proofness, withholding-proofness and borrowing-proofness.