Notes on the bankruptcy problem : an application of hydraulic rationing

Tamás Fleiner; Balázs Sziklai

We offer a new approach to the well-known bankruptcy problem based on Kaminski's idea. With the help of hydraulic rationing we give a proof to Aumann and Maschlers theorem i.e. the consistent solution of a bankruptcy problem is the nucleolus of the corresponding game. We use a system of vessels and water and the principles of mechanics to show this fact. The proof is not just simple and demonstrative but also provides an insight how the nucleolus is constructed in such games. -- bankruptcy problem ; nucleolus ; hydraulic rationings

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Year of publication:	2011
Authors:	Fleiner, Tamás ; Sziklai, Balázs
Publisher:	Budapest : Institute of Economics, Hungarian Academy of Sciences
Subject:	Insolvenz \| Insolvency \| Ungleichgewichtsökonomie \| Disequilibrium economics \| Core \| Kooperatives Spiel \| Cooperative game \| Theorie \| Theory