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Kantian Equilibrium
Author(s) -
Roemer John E.
Publication year - 2010
Publication title -
scandinavian journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.725
H-Index - 64
eISSN - 1467-9442
pISSN - 0347-0520
DOI - 10.1111/j.1467-9442.2009.01592.x
Subject(s) - economics , redistribution (election) , pareto principle , multiplicative function , mathematical economics , prisoner's dilemma , voting , dilemma , microeconomics , general equilibrium theory , politics , game theory , philosophy , mathematics , law , mathematical analysis , operations management , epistemology , political science
Consider a game whose strategies are “contributions”. A strategy profile is a Kantian equilibrium if no player would like all players to alter their contributions by the same multiplicative factor. Kantian equilibria are Pareto efficient. We characterize the allocation rules on several domains of environments that can be implemented as Kantian equilibria. The concept unifies the proportional solution on production economies and the linear cost‐share equilibrium on public‐good economies. We study Kantian equilibrium in the prisoner's dilemma, in a voting problem, and in a political economy where redistribution is the issue. The Kantian dictum engenders considerable but not unqualified cooperation.