The Consensus Value for Games in Partition Function Form

This paper studies a generalization of the consensus value (cf.Ju, Borm and Ruys (2004)) to the class of partition function form games.The concepts and axioms, related to the consensus value, are extended.This value is characterized as the unique function that satisfies efficiency, complete symmetry, the quasi null player property and additivity.By means of the transfer property, a second characterization is provided.Moreover, it is shown that this value satisfies the individual rationality under a certain condition, and well balances the trade-o® between coalition effects and externality effects.By modifying the stand-alone reduced game, a recursive formula for the value is established.A further generalization of the consensus value is discussed.Finally, two applications of the consensus value are given: one is for oligopoly games in partition function form and the other is about participation incentives in free-rider situations.oligopoly;game theory;games

Implementing Cooperative Solution Concepts: A Generalized Bidding Approach

This paper provides a framework for implementing and comparing several solution concepts for transferable utility cooperative games.We construct bidding mechanisms where players bid for the role of the proposer.The mechanisms differ in the power awarded to the proposer.The Shapley, consensus and equal surplus values are implemented in subgame perfect equilibrium outcomes as power shifts away from the proposer to the rest of the players.Moreover, an alternative informational structure where these solution concepts can be implemented without imposing any conditions of the transferable utility game is discussed as well.implementation;bidding mechanism;Shapley value;consensus value;equal surplus value

A Non-cooperative Approach to the Compensation Rules for Primeval Games

AMS Classifications: 91A06; 91A10; 91A12externality;compensation;primeval games;marginalistic rule;concession rule;primeval rule;bidding mechanism;implementation

Externalities and Compensation: Primeval Games and Solutions

The classical literature (Pigou (1920), Coase (1960), Arrow (1970)) and the relatively recent studies (cf.Varian (1994)) associate the externality problem with efficiency.This paper focuses explicitly on the compensation problem in the context of externalities.To capture the features of inter-individual externalities, this paper constructs a new game-theoretic framework: primeval games.These games are used to design normative compensation rules for the underlying compensation problems: the marginalistic rule, the concession rule, and the primeval rule.Characterizations of the marginalistic rule and the concession rule are provided and specific properties of the primeval rule are studied.externality;compensation;primeval games;marginalistic rule;concession rule;primeval rule

The Consensus Value: A New Solution Concept for Cooperative Games

By generalizing the standard solution for 2-person games into n-person cases, this paper develops a new solution concept for cooperative games: the consensus value.We characterize the consensus value as the unique function that satisfies efficiency, symmetry, the quasi dummy property and additivity.By means of the transfer property, a second characterization is provided.By defining the stand-alone reduced game, a recursive formula for the value is established.We also show that this value is the average of the Shapley value and the equal surplus solution.Furthermore, we discuss a possible generalization.cooperative games;game theory

Compensating Losses and Sharing Surpluses in Project-Allocation Situations (version 2)

By introducing the notions of projects and shares, this paper studies a class of economic environments, the so-called project-allocation situations, in which society may profit from cooperation, i.e., by reallocating the initial shares of projects among agents.This paper mainly focuses on the associated issues of compensation of losses and surplus sharing arising from the reallocation of projects.For this purpose, we construct and analyze an associated project-allocation game and a related system of games that explicitly models the underlying cooperative process.Speciffic solution concepts are proposed.allocation;games;projects;cooperation

Cooperation, compensation and transition

Cooperation and compensation are two important and well-linked issues in economics. The central question in cooperation is how to share the joint gains among participating players. Compensation is a specific aspect of surplus sharing problems providing incentives for agents to sacrifice their own direct interests to obtain higher payoffs for the coalition as a whole. This thesis first introduces and analyses a new solution concept, the consensus value, for cooperative games with transferable utility in characteristic function form and generalises it to partition function form games. These ideas and concepts are used to analyse several problems of loss compensation and surplus sharing: the general framework of project-allocation situations and the problem of externality-associated compensations within the new model of primeval games. Finally, transition by compensation is analysed in the framework of transition economies and, in particular, in the reform process of China.