On Bankruptcy Game Theoretic Interval Rules

TL;DR

This paper extends classical cooperative bankruptcy division rules to the interval setting, addressing uncertainties in claims and estate amounts, and analyzes the challenges of incorporating estate uncertainty.

Contribution

It introduces interval-based bankruptcy division rules and characterizes their properties, extending classical results to uncertain claim and estate scenarios.

Findings

Extended classical bankruptcy rules to interval claims.

Characterized properties of interval division rules.

Identified challenges in modeling estate uncertainty.

Abstract

Interval bankruptcy problems arise in situations where an estate has to be liquidated among a fixed number of creditors and uncertainty about the amounts of the claims is modeled by intervals. We extend in the interval setting the classical results by Curiel, Maschler and Tijs (1987) that characterize division rules which correspond to solutions of the cooperative bankruptcy game. Finally, we analyze the difficulties with incorporating the uncertainty about the estate.