EQUAL PROFITS AS A FAIR DIVISION

Abstract

This paper reports the results of a duopoly experiment in which each firm was represented by one subject, and the two subjects comprising a duopoly could send messages to one another prior to making their decisions. The questions to which the experiment is addressed are: (1) To what extent are a pair of subjects able to agree on a joint course of action. (2) When subjects agree, is the profit point they agree upon Pareto optimal, and (3) Among Pareto optimal points chosen, does any particular point, such as the joint profit maximum, the Nash cooperative game solution, or the point of equal profits, predominate.

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Document Details

Document Type
Technical Report
Publication Date
Apr 18, 1966
Accession Number
AD0633739

Entities

People

  • James W. Friedman

Organizations

  • Yale University

Tags

Communities of Interest

  • Human Systems

DTIC Thesaurus Topics

  • Agreements
  • Cooperative Games
  • Experimental Design
  • Hypotheses
  • Markov Processes
  • Materials
  • Military Research
  • Normal Density Functions
  • Normal Distribution
  • Observation
  • Probability
  • Symmetric Games
  • Transitions

Fields of Study

  • Economics

Readers

  • Economics
  • Operations Research