Strategyproof Nash Equilibria in Minimum Cost Spanning Tree Models
AbstractIn this paper we consider the Minimum Cost Spanning Tree model. We assume that a central planner aims at implementing the minimum cost spanning tree not knowing the true link costs. The central planner sets up a game where agents announce the link costs, a tree is chosen and costs are allocated according to the rules of the game. We characterize ways of allocating costs such that true announcements constitute Nash equilibria. In particular, we nd that the Shapley rule with respect to the irreducible cost matrix is consistent with truthful announcements while a series of other well-known rules (such as the Bird-rule, Serial Equal Split, the Proportional rule etc.) are not.
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Bibliographic InfoPaper provided by University of Copenhagen, Department of Food and Resource Economics in its series MSAP Working Paper Series with number 01_2010.
Length: 20 pages
Date of creation: Jan 2010
Date of revision:
Minimum cost spanning tree; Strategyproof Implementation; Nash equilibrium; Shapley value;
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