Sharing a Risky Cake

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David Baqaee; Richard Watt
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Sharing a Risky Cake (PDF 216.35 KB)
Consider an n-person bargaining problem where players bargain over the division of a cake whose size is stochastic. In such a game, the players are not only bargaining over the division of a cake, but they are also sharing risk. This paper presents the Nash bargaining solution to this problem, investigates its properties, and highlights a few special cases.