Skip to main content
Message Font: Serif | Sans-Serif
No. of Recommendations: 0
Not necessarily. If it so happens that #n+1's plan will be accepted and leave #10 with zero, then #10 will vote in favor of #n's plan as long as it leaves #10 with some money.

I see what you're saying, but I think you have to know how risk averse the players are. Given the uncertainties, I'm not sure that you can ever say with certainty that n+1's plan will definitely be accepted. For instance, what if one of the high-number players decides to give up a certain but negligible payoff in the hope that it will come down to them and they'll get it all? They might be willing to come out a little less rich because they want the chance of the big score.

The payoffs are high enough that one's risk aversion plays a big role, unless you assume that everyone's risk neutral. I didn't see that assumption in the problem.

Another thing: if they collude, they can reduce some of these risks. But I'm not sure what the rigid solution to the collusion negotiations might be.

Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.