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The Stable Fixtures Problem with Payments

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  • Peter Biro

    (Institute of Economics - Centre for Economic and Regional Studies - Hungarian Academy of Sciences and Department of Operations Research and Actuarial Sciences, Corvinus University of Budapest)

  • Walter Kern

    (Faculty of Electrical Engineering - Mathematics and Computer Science - University of Twente)

  • Daniel Paulusma

    (School of Engineering and Computing Sciences, Durham University, Science Laboratories)

  • Peter Wojuteczky

    (Institute of Economics - Centre for Economic and Regional Studies - Hungarian Academy of Sciences)

Abstract

We generalize two well-known game-theoretic models by introducing multiple partners matching games, de ned by a graph G = (N;E), with an integer vertex capacity function b and an edge weighting w. The set N consists of a number of players that are to form a set M E of 2-player coalitions ij with value w(ij), such that each player i is in at most b(i) coalitions. A payo is a mapping p : N N ! R with p(i; j) + p(j; i) = w(ij) if ij 2 M and p(i; j) = p(j; i) = 0 if ij =2 M. The pair (M; p) is called a solution. A pair of players i; j with ij 2 E nM blocks a solution (M; p) if i; j can form, possibly only after withdrawing from one of their existing 2-player coalitions, a new 2-player coalition in which they are mutually better o . A solution is stable if it has no blocking pairs. We give a polynomial-time algorithm that either nds that no stable solution exists, or obtains a stable solution. Previously this result was only known for multiple partners assignment games, which correspond to the case where G is bipartite (Sotomayor, 1992) and for the case where b 1 (Biro et al., 2012). We also characterize the set of stable solutions of a multiple partners matching game in two di erent ways and perform a study on the core of the corresponding cooperative game, where coalitions of any size may be formed. In particular we show that the standard relation between the existence of a stable solution and the non-emptiness of the core, which holds in the other models with payments, is no longer valid for our (most general) model.

Suggested Citation

  • Peter Biro & Walter Kern & Daniel Paulusma & Peter Wojuteczky, 2015. "The Stable Fixtures Problem with Payments," CERS-IE WORKING PAPERS 1545, Institute of Economics, Centre for Economic and Regional Studies.
  • Handle: RePEc:has:discpr:1545
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    References listed on IDEAS

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    1. Péter Biró & Walter Kern & Daniël Paulusma, 2012. "Computing solutions for matching games," International Journal of Game Theory, Springer;Game Theory Society, vol. 41(1), pages 75-90, February.
    2. Diamantoudi, Effrosyni & Miyagawa, Eiichi & Xue, Licun, 2004. "Random paths to stability in the roommate problem," Games and Economic Behavior, Elsevier, vol. 48(1), pages 18-28, July.
    3. Nimrod Megiddo, 1979. "Combinatorial Optimization with Rational Objective Functions," Mathematics of Operations Research, INFORMS, vol. 4(4), pages 414-424, November.
    4. Xiaotie Deng & Toshihide Ibaraki & Hiroshi Nagamochi, 1999. "Algorithmic Aspects of the Core of Combinatorial Optimization Games," Mathematics of Operations Research, INFORMS, vol. 24(3), pages 751-766, August.
    5. Johan Karlander & Kimmo Eriksson, 2001. "Stable outcomes of the roommate game with transferable utility," International Journal of Game Theory, Springer;Game Theory Society, vol. 29(4), pages 555-569.
    6. Sotomayor, Marilda, 2007. "Connecting the cooperative and competitive structures of the multiple-partners assignment game," Journal of Economic Theory, Elsevier, vol. 134(1), pages 155-174, May.
    7. Marilda Sotomayor, 1992. "The Multiple Partners Game," Palgrave Macmillan Books, in: Mukul Majumdar (ed.), Equilibrium and Dynamics, chapter 17, pages 322-354, Palgrave Macmillan.
    8. Marilda Sotomayor, 1999. "The lattice structure of the set of stable outcomes of the multiple partners assignment game," International Journal of Game Theory, Springer;Game Theory Society, vol. 28(4), pages 567-583.
    9. Walter Kern & Daniël Paulusma, 2003. "Matching Games: The Least Core and the Nucleolus," Mathematics of Operations Research, INFORMS, vol. 28(2), pages 294-308, May.
    10. Roth, Alvin E & Vande Vate, John H, 1990. "Random Paths to Stability in Two-Sided Matching," Econometrica, Econometric Society, vol. 58(6), pages 1475-1480, November.
    11. Bettina Klaus & Frédéric Payot, 2013. "Paths to Stability in the Assignment Problem," Cahiers de Recherches Economiques du Département d'économie 13.14, Université de Lausanne, Faculté des HEC, Département d’économie.
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    Cited by:

    1. Biró, Péter & Kern, Walter & Paulusma, Daniël & Wojuteczky, Péter, 2018. "The stable fixtures problem with payments," Games and Economic Behavior, Elsevier, vol. 108(C), pages 245-268.

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    More about this item

    Keywords

    stable solutions; cooperative game; core;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory

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