Key Concepts

Question 1

Nash Bargaining Solution

Answer 1

The unique bargaining solution that satisfies all 4 Axioms

1. Pareto
2. Symmetry
   3, Scale Covariance
3. Independence off Irrelevent Alternatives

Question 2

Symmetry of bargaining problems

Answer 2

If the players are indistuishable the game should not discriminate between them.

Question 3

Scaled Covariance

Answer 3

A transformation of the utility functio that maintains the preference order - should not alter the outcome of the bargaining (linear transformation)

Question 4

Ostroms Critique on Cooperative Game Theory

Answer 4

Participants cant cooperate and communicate (regarded as prisoners
Leviathan as the only way - If outsiders sanctions they might miss their use.

Question 5

Social Welfare Ordering

Answer 5

satisfies completeness, transitivity and reflexiveness

binary relation >- preference of utility vectors

Question 6

Welfarist Approach

Answer 6

Looks at individual agents utility vectors induced by an allocation rather than at relative fairness of one allocation compared with another

Question 7

AXIOME

1) Anonymity
2) Unanimity
3) Separability

Answer 7

SATISFIED BY ALL SWO

1) All agents should be treated equally
2) Whenever u (bigger than ) v –> u (preferred over) v
3) social welfare judgements should be independent of non-concerned agents

Question 8

Efficient solution concept

Answer 8

Pays out the grand coalititions value