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The stability of bargains behind the veil of ignorance

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Abstract

Although analyses about what representative individuals would choose behind the veil of ignorance have been regarded as n-person non-zero-sum cooperative games, none of the apparatus of game theory beyond 2-person non-zero-sum noncooperative games has actually been used. The “grand coalition” of all representative individuals emerges from behind the veil of ignorance to form a society unanimously. This paper investigates the consequences of extending the original position to allow three persons the possibility of forming binding coalitions behind the veil of ignorance. Just enough information and structure is added to the traditional analysis, to make bargaining feasible. The result is that whether or not representative individuals know the payoff structure for forming a society, a stable unanimous agreement may not emerge. The analysis shows yet another way in which original position arguments are sensitive to assumptions about information and criteria of rational decision behind the veil of ignorance.

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Gaa, J.C. The stability of bargains behind the veil of ignorance. Theor Decis 17, 119–133 (1984). https://doi.org/10.1007/BF00160978

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