win-win-win papakonstantinidis

model
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win-win-win papakonstantinidis
model
A proposal on Welfare Economics
Papakonstantinidis
Professor of political economy
ATEI Peloponnesus
GR

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win win - win Papakonstantinidis model- a twenty five years output, coming from both
theoretical/ academic and empirical level- could be concerned as a Nash "Non Cooperative
Games Theory (trust theory)' extension : Starting from the "bargaining/ games theory
analyzes individual winning strategies, through the utilities/shares possible combinations
between two players

The concept of this NEW methodological tool, is how to transfer a pure trust theory, to a
social market approach, or, how to joint economic theory with pure Sociology, by an
outside intervention; for this, Modern Innovation Theory- M.I.T (M. M Fischer) is useful.
Combining knowledge transfer and knowledge creation, thus creating a new kind of
information the integrated information (sensitization included), a new bargaining
behavior has to be formed. This, presuppose the acceptance of the COMMUNITY =
invisible part in the bargain (THE THIRD POLE), in terms of a minded person) in any
bargain between 2 bargainers at any bargain

ABSTRACT
In this research I have tried to collect, classify and compare the theoretical
material from various sources on the functioning of Social Welfare Function
(SWF), towards building a strong case with logical and coherent arguments,

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towards the one Triple Pole (A-B-COMMUNITY) Equilibrium (TPE), different from
N.E, that leads to the Social Bargaining Solution (SBS) AND coincide with the
"optimal" Community Collective Choice (CCC)
Based on this model, in practical level, the ambitious is to create a series of new
policies to strengthen social welfare, despite the "impossibility theorem" (K. Arrow
1955)
I supported with arguments, that "a simultaneous, reflective, strong effective
(Pareto), Flexible, fair (Rawls), collective (Amartya Sen) Social Welfare Function
(SWF) in the frame of a General Equilibrium (Walras), incorporating the values of
equality, justice, harmony, symmetry, and the hypothesis, of self-organization
(Papakonstantinidis) as well as the hypothesis of self-supporting bargaining
solution in a community level, should exist and be the only one

CONCLUSIONS
Capitalism is a strictly coherent system based on rationality, consistency and efficiency
(Pareto) at least. People have "consistent priorities" (in a fantastic strictly atomic list of
priorities) according to the neoclassical school of thought and make their expectations on
these The consequence of preferences (see Nash Equilibrium) and rationality in decision
making and the "Common Knowledge Rationality "refer to rigorous rational decisions
This assumes "rationality" and "consequence of behavior" (even without morality, justice,
equality of opportunity, which further increases the chances of maximizing the profit of
certain individuals (or increasing their satisfaction, thus minimizing the satisfaction of other
people of the community, (in spite of the Market theory of Adam Smith)
For all the "players" "i", for whom, is supposed to be consistent, efficient with
"consequence of behavior" as to the decision-making process (an idea on which capitalism
is based) the conditions and goals coincide They follow the same form of suicidal
expectation as the logic with

the 'barber's paradox" (paradox Russell 1918) who shaves

only those who can not shave themselves- a proposal that is not feasible: Suppose there is
a town with just one barber, who is male. In this town, every man keeps himself cleanshaven, and he does so by doing exactly one of two things: (a) shaving himself; or (b)
being shaved by the barber. Also, "The barber is a man in town who shaves all those, and
only those, men in town who do not shave themselves." From this, asking the question
"Who shaves the barber?" results in a paradox because according to the statement above,
he can either shave himself, or go to the barber (which happens to be himself). However,
neither of these possibilities are valid: they both result in the barber shaving himself, but
he cannot do this because he shaves only those men "who do not shave themselves".
Now, according to Kurt Gdel1,
1. "If the system is consistent, can not be complete." This is generally known as the
theorem incompleteness.
1

Kurt Gdel,ber formal unentscheidbare Stze der Principia Mathematica und verwandter Systeme,
I. and On formally undecidable propositions of Principia Mathematica and related systems I in Solomon
Feferman, ed., 1986. Kurt Gdel Collected works, Vol. I. Oxford University Press: 144-195. The original
German with a facing English translation, preceded by a very illuminating introductory note by Kleene

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2. The consistency of the axioms can not be proved within the system
On the other hand, the basic Neoclassical School of Thought is based on "win-win" outcome
(according to game payoffs, , depending on the strategies used by players (pure-mixed)
-see "binomial distributions", each for a Nash-Equilibrium)
This leads us to the conclusion that the "win-win" Equilibria have characteristics (a)
rationality (cause and effect at the same time) (b) consistency and (c) efficiency (Pareto)but not justice/equity (Rawls)
Just because they have these characteristics (particularly, the "consistency") means that
NE (based on neoclassical thinking belong to a system that is not complete
Capitalism, (especially the

nowadays globalization of economies) is indeed a rational,

efficient and above all consistent construction but, it is not complete (just because it is
consistent - Kurt Gdel)
Glaring example, the "Greeces

dept crisis ((2010-015) (see case study) where the

Economic Adjustment Programs, relied solely on consistency and rationality (in numbers,
that is) but the result was the worst in terms of justice, equity and equality
If we could find some system expansion tools, so as to include "social welfare and justice
and equity" without reducing (theorem Pareto) its efficiency, would we have a better and
hopefull new system?
The answer may be YES, by the win-win-win papakonstantinidis model

The win-win-win papakonstantinidis model" has been proposed to transfer the system
from the Gdel's "incompleteness" in a new situation with less consistency, more justice,
more socialization more equity2 , more effective more cooperation, more self-organization
Besides The degree to which social justice is achieved in a given time and place should be
measured by two notions: 1) the greatest good for the greatest number, and 2), how the
least powerful and the smallest minorities in a society are faring. Ched Myers3
There are many aspects to justice and the creation of a just world. These include social
and economic factors as well as the principles of equity and equal rights.
Social justice has been defined in a variety of ways. Amongst them, they incorporate
concepts of basic rights, the realisation of human potential, social benefit, a healthy planet,
an equitable distribution of resources, equal opportunities and obligations, security, and
freedom from discrimination. Economic justice really forms a part of social justice. It seeks
the equitable distribution of worlds natural and intellectual wealth so that everyone is able
to gain a fair share. Social justice means equal rights for all, regardless of gender, race,
class, ethnicity, citizenship, religion, age or sexual orientation. It implies equal rights for
2

Anup Shah (2012) Climate Justice and Equity (justice # equity) Global Issues, Jan 8, 2012
Ched Myers (2009) Sociopolitical Criticism. In Searching for Meaning: An Introduction to
Interpreting the New Testament, ed. by Paula Gooder, Westminster John Knox/SPCK
3

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women and girls in workplaces, homes and public life. It implies economic justice which
means governments must take active steps to alleviate poverty and redress past injustices.
In a world where millions starve and minorities are discriminated against, such goals are
still a long way off (Sabbath Economics) 4.
Humans are not predictable units, so as to define a single behavior. With this basic
thinking, I accepted the Gdel's theorem of "incompleteness" and I have incorporated it
in the basic logic of this original work (if a system is consistent, is not complete)
Then, I've

focused on

coincidence of

main globalization function which is the

"bargain" with the

(a) rationality, (b) consistency, (c) efficiency and I've tried to find the

deviation points,from what is called "Social Welfare"

Then, putting the

"Bargaining Solution" (one of the Nash Equilibria) on the microscope

I've tried to find an alternative social solution, the "third Way" by allowing the Community
to participate as the third independent and more integrated "part of the bargain, between
two negotiators (if it is accepted by these)
Thus, the problem and its own solution is "transferred" from the two-dimensional space in a
three-dimensional space : In this 3D space we are seeking to define the 3-pole bargaining
Solution

(A, B, and the Community) on the "pin head" as one of the Karatheodory's

umbilical points (Chapter 5) [any isolated point on Sphere, is an umbilical Point]

Any system, which includes the Community as the third and most complete player in the
"play", is expected to win the coveted completeness while maintaining a minimum level of
consistency, efficiency and logic
The "vehicle" of this transition will be the theorem of justice (Rawls) -under the condition of
acceptance of the "veil" or "original position" posed by "Theory of Justice"
So the win-win-win model meets with the need of making "globalization", more interactive
with the poverty and inequality and justice all over the world

Special review to local communities: local development

The win-win-win papakonstantinidis model is a methodological tool for conflict resolution,
especially in the case of decision making, or in forming "instant reflection winning
strategies" an the BARGAIN (which is the frame) It deals with local development, both as a
regional and social sciences field. It proves that building social capital at local level mainly
depends on social trust links among local people: Social cohesion based on social capital
may be measured by the diversification Rate (R *) from strict globalization rules: From this
point of view, local people intervention should be useful, so as to diversify these "rules" at
local level adjusting them to local identity, including communication code, customs, ethics,
culture. The Win-win-win methodology [Papakonstantinidis Model] should facilitate local
4

Ched Myers (2002) The Biblical Vision of Sabbath Economics Church of the Saviour.

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people to "readjust" bargaining globalization rules locally, through a sensitization process:

Community is defined as a discrete spatial / cultural entity at its sensitization process' limit
July 17, 2015
papakonstantinidis

The win-win-win papakonstantinidis model (2002, August, SW) may, thus,

transform individual winning instant reflection strategies (the win-win Nash
Theory) in a NEW three poles-equilibrium point, including the COMMUNITY
(Environmental Protection, Value Systems, Ethic etc), which is the absolute
cooperation limit point in the bargain between TWO

lim P (&)Q (&)R (&) MaxU U U

i

A B C

Pi (&) mixed ..strategy..A,..under..Pi ..( probabilit y)...etc.., U A Utility..A

ECONOMIC PROOF
PARETO EFFICIENCY

max Utility.Function : ... max ...U ( x1 , x 2 ,....x n )... :

pixi M

xi 0

xi {1.2....n}

max Utility.Function : ... max ...U ( x1 , x 2 ,....x n )... :

Papakonstantinidis:

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lim P (&)Q (&)R (&) MaxU U U

i

A B C

Pi (&) mixed ..strategy.. A,..under..Pi ..( probabilit y)...etc.., U A Utility.. A

SIMPLE WIN-WIN-WIN PAPAK EQUILIBRIUM

(4)

i , xi Si : f i ( xi*1 , xi* 2 , xi* 3 ) f i ( xi 1 , xi* 2 , xi* 3 )....i 1,2,3

pxi prices * quantities , xi... Sum..of .. products.. pxi

In the case that Community plays role in the game (depended on n)

WIN-WIN-WIN PAPAK EQUILIBRIUM INCLUDING THE COMMUNITY AS WHOLE

(5)

i, xi S i : f i ( xi*1 , xi*2 , xi*C ) f i ( xi 1 , xi*2 , xi*C ) f i .( xi 1 , xi 2 , xi*C ) f i ( x1 , x2 , xc )

xi strategy.. profile...and .. fi ( xi ) .. payoff .. function

It is a revolution in Social Science Theory: By introducing the third pole (Community) in any
bargain between two players in a game (through the sensitization process) this model
contributes in behavioral Sciences. It forms the platform of a Social Trust creation,
leading to Social Cohesion (at Local Level, at least)

win - win - win Papakonstantinidis model has been characterized as a new Theory in Social
Sciences in many countries. It has been translated in Hungarian language. It has been
accepted in India, Philippines, Bangladesh, South Africa (Durban) as well as in World
Organization, as for example by the International Sociological Association (I.S.A) as it
produces a new bargaining philosophy

As it has been written, as a comment: it is interesting to note any feedback to such a

model, that is open and flexible to reforms, having as principle the third win that is
disseminated to all factors of local social
The Nash Extension
The extension of the Nash Bargaining Solution concerns to find that value, among infinite
number of the NE equilibria (NE extensions), on the
3-D space, defined by the
Caratheodory Conjecture: In fact, we must find the value of x*% among other x s
(NE extensions) in which the Utility of each one of the independent players AND THE
COMMUNITY as a total, derive the max UTILITY :

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U A U B U G U A * U B *U C max

for..this..must..be..U A * BB * U C ' 0..(or..in..neiborhood ..of ..ZERO)

Math proof
U AU B ,U C
,
UA x
UB y
U c (100 x y ) n
The main difference in win-win-win papakonstantinidis model is that the utility function (UF)

U c (100 x y ) n has been planned, such as to meet the total needs of the Community
and not only the 3rd player in a game

U ( x, y )

C
The Utility Function
thus expresses the win-win-win equilibrium leads in social
welfare that meets the social needs of the community From this point of view the win-winwin social welfare function has been planned as to meet the needs (a) of the 2
individuals' strictly atomic interests and (b) the needs of the rest Community's people

xy (100 x y ) n , , max [ xy (100 x y ) n ]' 0

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But,

[ xy (100 x y ) n ]' x ' y (100 x y ) n xy ' (100 x y ) n xy[(100 x y ) n ]' 0

y (100 x y ) n x (100 x y ) n nxy (100 x y ) n 1 0

y (100 x y ) n 1 (100 x y ) x (100 x y ) n 1 (100 x y ) nxy (100 x y ) n 1 0

If,

100 x y 0

y (100 x y ) x (100 x y ) nxy 0

x y
(100 x y ) ( 1) n
xy

( x y )(100 x y ) nxy 0
x y
0
consider...
xy

(100 x y ) (1)n 100 x y (n)

but..(100 x y ) ..%..of ..the..C..(community )... exp ected ...shares..strategy

%..of ..C.. player n

1
....the()..denotes..the.."C" negative"that..let..it..to..reduce..%.. from.. A..and ..B

the.."C "..b arg aining ...solution...is..the..x * %

..ensuring..equality..and .. justice..at..the..sam

notes :
A, B.C ...do, , , not...cooperate.. forward
A, B, C ..must..collaborate..in..and ..during ..the..b arg ain..(ins tan t..reflection..winning ..stra
" C "... exp resses ...not ...only..the..rest ..( no..b arg ain.. participants ), , but...also..the..total ..co
cultural ...heritage, world ...cultivation...the.." human...being "..." Homo...Sapiens"
From...this.. po int ..of ...view,...Community... participation..in..any..b arg ain...between..TWO
Also,..COMMUNITY the.." c".. factor..MUST ... exp ress..the.." Community..Fear".. from.

For ..this.." Community.. participation"..is..captured ..as...(100 x y ) n , where..n the.. fe

the.. A, B..utility.. functions...must..be..linear

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cases

n
1,.x * %... % 100% max(quite..unequality..and ..unjustice..in..distibution...of . A, B, and ..Com
1
n
2...x * % % 50 50 0
2
n
3...x * % %.. 33,3333...IDEAL...SITUATION
3
x
4 ......x * % .
% UNSTABLE .(THEOCHARIS OSCILLATIO N )...of .. A, B, C.. exp ectati
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