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Gale's Fixed Tax for Exchanging Houses

Andersson, Tommy LU ; Ehlers, Lars ; Svensson, Lars-Gunnar LU and Tierney, Ryan (2022) In Mathematics of Operations Research 47(4). p.3110-3128
Abstract
We consider taxation of exchanges among a set of agents in which each agent owns one object. Agents may have different valuations for the objects, and they need to pay taxes for exchanges. We show that, if a rule satisfies individual rationality, strategy-proofness, constrained efficiency, weak anonymity, and weak consistency, then it is either the no-trade rule or a fixed-tax core rule. For the latter rules, whenever any agent exchanges an object, the agent pays the same fixed tax (a lump sum payment that is identical for all agents) independently of which object the agent consumes. Gale’s top trading cycles algorithm finds the final assignment using the agents’ valuations adjusted with the fixed tax if the induced preferences are strict.
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author
; ; and
organization
publishing date
type
Contribution to journal
publication status
published
subject
in
Mathematics of Operations Research
volume
47
issue
4
pages
3110 - 3128
publisher
INFORMS Institute for Operations Research and the Management Sciences
external identifiers
  • scopus:85130541861
ISSN
0364-765X
DOI
10.1287/moor.2021.1244
language
English
LU publication?
yes
id
b3822afb-2161-4fe1-a9de-a73376dbf407
date added to LUP
2021-11-13 18:08:39
date last changed
2025-02-09 07:42:54
@article{b3822afb-2161-4fe1-a9de-a73376dbf407,
  abstract     = {{We consider taxation of exchanges among a set of agents in which each agent owns one object. Agents may have different valuations for the objects, and they need to pay taxes for exchanges. We show that, if a rule satisfies individual rationality, strategy-proofness, constrained efficiency, weak anonymity, and weak consistency, then it is either the no-trade rule or a fixed-tax core rule. For the latter rules, whenever any agent exchanges an object, the agent pays the same fixed tax (a lump sum payment that is identical for all agents) independently of which object the agent consumes. Gale’s top trading cycles algorithm finds the final assignment using the agents’ valuations adjusted with the fixed tax if the induced preferences are strict.}},
  author       = {{Andersson, Tommy and Ehlers, Lars and Svensson, Lars-Gunnar and Tierney, Ryan}},
  issn         = {{0364-765X}},
  language     = {{eng}},
  month        = {{03}},
  number       = {{4}},
  pages        = {{3110--3128}},
  publisher    = {{INFORMS Institute for Operations Research and the Management Sciences}},
  series       = {{Mathematics of Operations Research}},
  title        = {{Gale's Fixed Tax for Exchanging Houses}},
  url          = {{http://dx.doi.org/10.1287/moor.2021.1244}},
  doi          = {{10.1287/moor.2021.1244}},
  volume       = {{47}},
  year         = {{2022}},
}