In principle one could attempt to construct appropriate monotone utility functions that would have the desired properties with respect to the path used in Theorem 3. It is, however, far from clear whether such a construction is possible. We do not attempt to resolve this question here. Whether an exact translation could be accomplished is, ultimately, a question of purely combinatorial interest: since our aim is to demonstrate that exponential length contract paths are needed with monotone utility functions we are not, primarily, concerned with obtaining an optimal bound.
Proof. We describe the details only for the case of being even: the result when
is odd is obtained
by a simple modification which we shall merely provide in outline.
Let with
. For any path
Of course,
does not describe an
-contract path6: it is, however, not difficult to interpolate appropriate allocations,
, in
order to convert it to such a path. Consider the subsets
(with
) defined
as follows:
The choice for is relatively simple. Given
,
The construction for is rather more complicated. Its main idea is to make use of the fact
that the size of each set
occurring in
is very tightly
constrained:
is either
or
according to whether
is odd or even.
We first demonstrate that
each set of size
can have at most two strict subsets (of size
) occurring within
:
thus, every
of size
has exactly
or
or
subsets of size
on
.
To see this suppose the contrary.
Let
,
,
, and
be such that
with
We now define as
To show that
is IR we need to demonstrate
To see that this path is the unique IR -contract path implementing
,
consider any position
and allocation
other than
or
. It may be assumed that the deal
is an
-contract.
If
then
and
. Hence
. In the former
case,
and
from which
and thus
is
not IR. In the latter case
since
is a
from
and
giving
. Again
fails to be IR since
fails to give any increase in the value of
. We are left with the case
so that
and
. Since
is
assumed to be an
-contract this gives
. For the first possibility
could not be a set on
:
and
are both subsets
of
and there can be at most two such subsets occurring on
. It follows,
therefore, that
giving
so that
is not IR.
In the second possibility,
but
as
so
the deal would result in an overall loss.
We deduce that for each
the only IR
-contract consistent with it is the
deal
.
The final stage is to prove that the utility function is indeed a monotone
function. Suppose
and
are subsets of
with
. We need to show
that
. We may assume that
, that
occurs as some
set within
, and that
. If
or
but does not occur on
we
have
and the required inequality holds; if
then in order for
to be possible we would need
, which would give
and this is the maximum value that any subset is assigned by
. We are left with
only
,
and
on
to consider.
It has already been shown that there are at most two subsets of
that can occur on
.
Consider the different possibilities:
We conclude by observing that a similar construction can be used if is odd: use the path
described above but modifying it so that one resource (
) is always
held by
. Only minor modifications to the utility function definitions are needed.
Following the construction presented in Theorem 4, gives the following
utility function definitions with
.
Proof. We again illustrate the constructions only for the case of being even, noting the
modification to deal with odd values of
outlined at the end of the proof of Theorem 4.
The path
is used for both cases.
For (a), we require
to be defined as monotone functions with which
will be the unique cooperatively rational
-contract path to realise the cooperatively rational deal
where
. In this
case we set
to be,
It remains only to show that these choices for
define monotone utility functions.
Consider and
suppose
and
are subsets of
with
. If
, or
does not occur on
then
. If
or is
then
which is the maximum value attainable by
.
So we may assume that
, occurs on
, i.e.
for some
, and that
and is either a
set or a
.
From the definition of
,
: if
then
;
if
is a
from
then
.
We deduce that if
then
, i.e.
the utility function is monotone.
Now consider with
and
subsets of
having
. If
or
does not occur in
then
its maximal value.
If
or
is
then
. Thus we may
assume that
giving
and
,
so that
is either a
or one of the
sets
. If
is
a
then
; if it is the
set
then
; if it
is the
set
then
. It follows that
is monotone completing
the proof of part (a).
For (b) we use,
That the choices for
describe monotone utility
functions can be shown by a similar argument to that of part (a).
That we can demonstrate similar extremal behaviours for contract path length with rationality
constraints in both money-based (individual rationality) and money-free (cooperative rationality,
equitable) settings irrespective of whether monotonicity properties are assumed, has some interesting
parallels with other contexts in which monotonicity is relevant. In particular we can
observe that in common with the complexity results already noted from
dunne:2003 - deciding if an allocation is Pareto optimal, if an allocation maximises ,
or if an IR
-contract path exists - requiring utility functions to be monotone does not result
in a setting which is computationally more tractable.