Nicolò A.,Yu Y. (2008)

Strategic divide and choose. Games and Economic Behavior, Volume 64, Issue 1, 2008, Pages 268-289.



We consider the classic cake-division problem when the cake is a heterogeneous good represented by an interval in the real line. We provide a mechanism to implement, in an anonymous way, an envy-free and efficient allocation when agents have private information on their preferences. The mechanism is a multi-step sequential game form in which each agent at each step receives a morsel of the cake that is the intersection of what she asks for herself and what the other agent concedes to her.