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Coalition Formation and Potential Games

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  • Slikker, Marco

Abstract

In this paper we study the formation of coalition structures in situations described by a cooperative game. Players choose independently which coalition they want to join. The payoffs to the players are determined by an allocation rule on the underlying game and the coalition structure that results from the strategies of the players according to some formation rule. We study two well-known coalition structure formation rules. We show that for both formation rules there exists a unique component efficient allocation rule that results in a potential game and study the coalition structures resulting from potential maximizing strategy profiles.

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Bibliographic Info

Article provided by Elsevier in its journal Games and Economic Behavior.

Volume (Year): 37 (2001)
Issue (Month): 2 (November)
Pages: 436-448

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Handle: RePEc:eee:gamebe:v:37:y:2001:i:2:p:436-448

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Web page: http://www.elsevier.com/locate/inca/622836

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References

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  1. Roger B. Myerson, 1978. "Conference Structures and Fair Allocation Rules," Discussion Papers 363, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  2. Monderer, Dov & Shapley, Lloyd S., 1996. "Potential Games," Games and Economic Behavior, Elsevier, vol. 14(1), pages 124-143, May.
  3. Hart, Sergiu & Mas-Colell, Andreu, 1989. "Potential, Value, and Consistency," Econometrica, Econometric Society, vol. 57(3), pages 589-614, May.
  4. Slikker, M. & Dutta, B. & Tijs, S.H. & Nouweland, C.G.A.M. van den, 2000. "Potential maximizers and network formation," Open Access publications from Tilburg University urn:nbn:nl:ui:12-84647, Tilburg University.
  5. Roger B. Myerson, 1976. "Graphs and Cooperation in Games," Discussion Papers 246, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  6. Hart, Sergiu & Kurz, Mordecai, 1983. "Endogenous Formation of Coalitions," Econometrica, Econometric Society, vol. 51(4), pages 1047-64, July.
  7. Qin, Cheng-Zhong, 1996. "Endogenous Formation of Cooperation Structures," Journal of Economic Theory, Elsevier, vol. 69(1), pages 218-226, April.
  8. Ui, Takashi, 2000. "A Shapley Value Representation of Potential Games," Games and Economic Behavior, Elsevier, vol. 31(1), pages 121-135, April.
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Cited by:
  1. repec:pdn:wpaper:74 is not listed on IDEAS
  2. MAULEON, Ana & ROEHL, Nils & VANNETELBOSCH, Vincent, 2014. "Constitutions and social networks," CORE Discussion Papers 2014003, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  3. Dimitrov, Dinko & Haake, Claus-Jochen, 2008. "Stable governments and the semistrict core," Games and Economic Behavior, Elsevier, vol. 62(2), pages 460-475, March.
  4. Tercieux, Olivier & Voorneveld, Mark, 2005. "The cutting power of preparation," Working Paper Series in Economics and Finance 583, Stockholm School of Economics.
  5. Dinko Dimitrov & Claus-Jochen Haake, 2006. "Coalition formation in simple games: The semistrict core," Working Papers 378, Bielefeld University, Center for Mathematical Economics.
  6. Rod Garratt & James E. Parco & Cheng-Zhong Qin & Amnon Rapoport, 2005. "Potential Maximization And Coalition Government Formation," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 7(04), pages 407-429.
  7. Olivier Tercieux & Mark Voorneveld, 2010. "The cutting power of preparation," Computational Statistics, Springer, vol. 71(1), pages 85-101, February.
  8. Barry Feldman, 2002. "A Dual Model of Cooperative Value," Game Theory and Information 0207001, EconWPA.
  9. D. Dragone & L. Lambertini & A. Palestini, 2008. "A Class of Best-Response Potential Games," Working Papers 635, Dipartimento Scienze Economiche, Universita' di Bologna.

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