Divide and choose
Divide and choose (also Cut and choose or I cut, you choose) is a procedure for envy-free cake-cutting between two partners. It involves a heterogeneous good or resource ("the cake") and two partners which have different preferences over parts of the cake. The protocol proceeds as follows: one person ("the cutter") cuts the cake to two pieces; the other person ("the chooser") chooses one of the pieces; the cutter receives the remaining piece.
Divide-and-choose is mentioned in the Bible, in the Book of Genesis (chapter 13). When Abraham and Lot come to the land of Canaan, Abraham suggests that they divide it among them. Then Abraham, coming from the south, divides the land to a "left" (western) part and a "right" (eastern) part, and lets Lot choose. Lot chooses the eastern part which contains Sodom and Gomorrah, and Abraham is left with the western part which contains Beer Sheva, Hebron, Beit El and Shechem.
Divide-and-choose is envy-free in the following sense: each of the two partners can act in a way that guarantees that, according to her own subjective taste, her allocated share is at least as valuable as the other share, regardless of what the other partner does. Here is how each partner can act:
- The cutter can cut the cake to two pieces that she considers equal. Then, regardless of what the chooser does, she is left with a piece that is as valuable as the other piece.
- The chooser can select the piece which she considers more valuable. Then, even if the cutter divided the cake to pieces that are very unequal (in the chooser's eyes), the chooser still has no reason to complain because she chose the piece that is more valuable in her own eyes.
To an external viewer, the division might seem unfair, but to the two involved partners, the division is fair - no partner envies the other.
If the value functions of the partners are additive functions, then divide-and-choose is also proportional in the following sense: each partner can act in a way that guarantees that her allocated share has a value of at least 1/2 of the total cake value. This is because, with additive valuations, every envy-free division is also proportional.
Divide and choose assumes the parties have equal entitlements and wish to decide the division themselves or use mediation rather than arbitration. The goods are assumed to be divisible in any way, but each party may value the bits differently.
The cutter has an incentive to divide as fairly as possible: for if they do not, they will likely receive an undesirable portion. This rule is a concrete application of the veil of ignorance concept.
The divide and choose method does not guarantee each person gets exactly half the cake by their own valuations, and so is not an exact division. There is no finite procedure for exact division but it can be done using two moving knives; see Austin moving-knife procedure.
Divide-and-choose might produce inefficient allocations.
One commonly used example is a cake that is half vanilla and half chocolate. Suppose Bob likes only chocolate, and Carol only vanilla. If Bob is the cutter and he is unaware of Carol's preference, his safe strategy is to divide the cake so that each half contains an equal amount of chocolate. But then, regardless of Carol's choice, Bob gets only half the chocolate and the allocation is clearly not Pareto efficient. It is entirely possible that Bob, in his ignorance, would put all the vanilla (and some amount of chocolate) in one larger portion, so Carol gets everything she wants while he would receive less than what he could have gotten by negotiating.
If Bob knew Carol's preference and liked her, he could cut the cake into an all-chocolate piece, and an all-vanilla piece, Carol would choose the vanilla piece, and Bob would get all the chocolate. On the other hand, if he doesn't like Carol he can cut the cake into slightly more than half vanilla in one portion and the rest of the vanilla and all the chocolate in the other. Carol might also be motivated to take the portion with the chocolate to spite Bob. There is a procedure to solve even this but it is very unstable in the face of a small error in judgement. More practical solutions that can't guarantee optimality but are much better than divide and choose have been devised by Steven Brams and Alan Taylor, in particular the adjusted winner procedure (AW).
In 2006 Steven J. Brams, Michael A. Jones, and Christian Klamler detailed a new way to cut a cake called the surplus procedure (SP) that satisfies equitability and so solves the above problem. Both people's subjective valuation of their piece as a proportion of the whole is the same.
- Fair division
- Resource allocation
- Market maker, players in financial markets who offer to either buy or sell at a given price (plus a spread)
Notes and references
- Cake Cutting with Full Knowledge David McQuillan 1999 (not reviewed)
- Steven J. Brams and Alan D. Taylor (1996). Fair Division - From cake-cutting to dispute resolution Cambridge University Press. ISBN 0-521-55390-3
- Steven J. Brams and Alan D. Taylor (1999). The Win/win Solution: Guaranteeing Fair Shares to Everybody Norton Paperback. ISBN 0-393-04729-6
- Better Ways to Cut a Cake by Steven J. Brams, Michael A. Jones, and Christian Klamler in the Notices of the American Mathematical Society December 2006.