Frank M. V. Feys

Frank M. V. Feys

No deployed automated market maker lets its liquidity providers vote on the trading function. We show this is structural, not an oversight. On the weighted-product family with $n \geq 3$ assets, no aggregation rule is at once fair and strategy-proof. Arrovian fairness forces a unique form, the weighted Aitchison centroid, the weighted geometric mean of the providers' preferred pools. But fairness forces mean-type aggregation and strategy-proofness forces median-type, and the only rule that is both is a single-provider dictator. The obstruction is sharp: it vanishes at $n = 2$, where a fair strategy-proof rule exists. Under the Frongillo--Papireddygari--Waggoner equivalence, the centroid is Genest's logarithmic opinion pool, and the impossibility transfers to externally Bayesian pooling.

Frank M. V. Feys

We develop an abstract axiomatic theory of tie-breaking. A tie-breaking input consists of a finite set N of players, a weak order on N representing the standings to be refined, and an auxiliary information item drawn from a set on which the symmetric group Sym(N) acts. Within this minimal framework we prove three theorems. First, no tie-breaking rule producing a strict linear order can be anonymous, provided the input space contains even one intrinsically symmetric situation, a condition met in essentially every realistic application. Second, when we allow the rule to output a partition of N (rather than a strict ranking), there is a unique rule satisfying two natural axioms: it is the partition of N into orbits of the joint stabilizer of the input. Third, every reasonable strict tie-breaking rule decomposes uniquely as the canonical orbit partition followed by an arbitrary completion. The decomposition makes precise the informal observation that real tie-breaking systems are honest until forced to be arbitrary. The framework is broad enough to capture chess tournament tie-breakers, sports league regulations, voting tie-breakers, tie-breaking among symmetric players in cooperative games, and ranking by network centrality measures, all within a single uniform formalism.

Frank M. V. Feys

The space L of linear value maps on a finite-player cooperative game G^N is finite-dimensional, and admits a canonical inner product induced by the Harsanyi-dividend decomposition of G^N. We show that this inner product is intrinsic: the same value arises from any orthonormal basis of G^N with respect to the Harsanyi inner product. Within this geometry, the subspace L^{ESL} of efficient, symmetric, linear value maps admits a clean structure theorem. The induced orthogonal stratification of L by coalition size yields a canonical linear isomorphism L^{ESL} = R^{n-1}, under which every efficient symmetric linear value map decomposes uniquely into n-1 stratified epsilons, one per coalition size. The classical egalitarian Shapley family of Joosten (1996) is precisely the diagonal slice of this R^{n-1}. The orthogonal projection of any Psi in L^{ESL} onto this diagonal yields an optimal parameter eps*(Psi) equal to the weighted mean of the stratified epsilons under an explicit probability distribution {w_a} over coalition sizes, and the goodness-of-fit R^2(Psi) equals one minus the relative weighted variance of those epsilons. The framework is a literal regression-statistics analogue of the coefficient of determination. At n=4 it produces a clean three-way classification of the standard alternatives to the Shapley value: the Banzhaf value is nearly orthogonal to the egalitarian Shapley axis (R^2 ~ 1%); the equal-surplus-division value is moderately aligned (R^2 ~ 38%); the solidarity value is almost entirely aligned (R^2 ~ 99.6%). Asymptotically R^2(ESD) -> 1, R^2(So) -> 1, and R^2(Bz) -> 1/2, the last reflecting a structural identity between the efficiency defect and the egalitarian-Shapley deviation of the Banzhaf value at every coalition size.