Ambiguity in Partnerships

Authors


  •  Research supported by ESRC grant no. R000222597, by the British Academy and by the Commerzbankstiftung. We would like to thank Jürgen Eichberger, John Fender, Shasikanta Nandeibam, Peter Sinclair, participants of ESEM’97 in Toulouse, the Royal Economic Society ’98 conference in Coventry, the Second International Conference on Public Economic Theory 2000 in Coventry and the First World Conference of the Game Theory Society 2000 in Bilbao, as well as three anonymous referees and three editors for helpful comments. Appendix is available on this Journal's website http://www.res.org.

Abstract

The consequences of ambiguity for partnerships are addressed. Partnerships with symmetric linear production functions are analysed in a Choquet Expected Utility (CEU)-framework. Nash equilibrium in pure strategies is extended to CEU-games. A class of sharing rules are proposed that make constructive use of strategic ambiguity in partnerships. Results on ex ante efficiency and ex post efficiency of the outcomes are presented.

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