Transferable Utility Games with Uncertainty
AbstractWe introduce the concept of a transferable utility game with uncertainty (TUU-game). In a TUU-game there is uncertainty regarding the payoffs of coalitions. One out of a finite number of states of nature may materialize and conditional on the state, the players are involved in a particular transferable utility game. We consider the case without ex ante commitment possibilities and propose the Weak Sequential Core as a solution concept. We characterize the Weak Sequential Core and show that it is non-empty if all ex post TU-games are convex. We study bankruptcy games with uncertainty and apply the Weak Sequential Core. We find that most of the best-known allocation rules are unstable in this setting, except for the Constrained Equal Awards rule.
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Bibliographic InfoPaper provided by Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization in its series Research Memoranda with number 038.
Date of creation: 2010
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Other versions of this item:
- C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-08-28 (All new papers)
- NEP-GTH-2010-08-28 (Game Theory)
- NEP-UPT-2010-08-28 (Utility Models & Prospect Theory)
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