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Cooperative Games in Strategic Form

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  • Sergiu Hart
  • Andreu Mas-Colell

Abstract

In this paper we view bargaining and cooperation as an interaction superimposed on a strategic form game. A multistage bargaining procedure for N players, the "proposer commitment" procedure, is presented. It is inspired by Nash's two-player variable-threat model; a key feature is the commitment to "threats." We establish links to classical cooperative game theory solutions, such as the Shapley value in the transferable utility case. However, we show that even in standard pure exchange economies the traditional coalitional function may not be adequate when utilities are not transferable.

Suggested Citation

  • Sergiu Hart & Andreu Mas-Colell, 2008. "Cooperative Games in Strategic Form," Discussion Paper Series dp484, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.
    • Handle: RePEc:huj:dispap:dp484
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    References listed on IDEAS

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    1. Hart, Sergiu & Mas-Colell, Andreu, 1996. "Harsanyi Values of Large Economies: Nonequivalence to Competitive Equilibria," Games and Economic Behavior, Elsevier, vol. 13(1), pages 74-99, March.
    2. Andrew Postlewaite, 1979. "Manipulation via Endowments," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 46(2), pages 255-262.
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    4. Scarf, Herbert E., 1971. "On the existence of a coopertive solution for a general class of N-person games," Journal of Economic Theory, Elsevier, vol. 3(2), pages 169-181, June.
    5. Binmore, Ken & Osborne, Martin J. & Rubinstein, Ariel, 1992. "Noncooperative models of bargaining," Handbook of Game Theory with Economic Applications, in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 1, chapter 7, pages 179-225, Elsevier.
    6. Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April.
    7. Martin J. Osborne & Ariel Rubinstein, 2005. "Bargaining and Markets," Levine's Bibliography 666156000000000515, UCLA Department of Economics.
    8. Geoffroy de Clippel & Roberto Serrano, 2005. "Marginal Contributions and Externalities in the Value," Working Papers 2005-11, Brown University, Department of Economics.
    9. Sergiu Hart, 2004. "A comparison of non-transferable utility values," Theory and Decision, Springer, vol. 56(1), pages 35-46, April.
    10. Geoffroy de Clippel & Roberto Serrano, 2008. "Marginal Contributions and Externalities in the Value," Econometrica, Econometric Society, vol. 76(6), pages 1413-1436, November.
    11. R. M. Thrall & W. F. Lucas, 1963. "N‐person games in partition function form," Naval Research Logistics Quarterly, John Wiley & Sons, vol. 10(1), pages 281-298, March.
    12. Martin J. Osborne & Ariel Rubinstein, 1994. "A Course in Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650401, December.
    13. Macho-Stadler, Ines & Perez-Castrillo, David & Wettstein, David, 2007. "Sharing the surplus: An extension of the Shapley value for environments with externalities," Journal of Economic Theory, Elsevier, vol. 135(1), pages 339-356, July.
    14. Maschler, M & Owen, G, 1989. "The Consistent Shapley Value for Hyperplane Games," International Journal of Game Theory, Springer;Game Theory Society, vol. 18(4), pages 389-407.
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    More about this item

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • D7 - Microeconomics - - Analysis of Collective Decision-Making

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