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Stability and Fairness in Models with a Multiple Membership

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Author Info

  • Michel Le Breton

    () (Universit de Toulouse 1, GREMAQ and IDEI, Toulouse, France)

  • Juan D. Moreno-Ternero

    () (U. de Mlaga, U. Pablo de Olavide y CORE, Universit catholique de Louvain)

  • Alexei Savvateev

    () (New Economic School, Moscow, Russia)

  • Shlomo Weber

    () (Southern Methodist University, USA, and the New Economic School, Moscow, Russia)

Abstract

This article studies a model of coalition formation for the joint production (and finance) of public projects, in which agents may belong to multiple coalitions. We show that, if projects are divisible, there always exists a stable (secession-proof) structure, i.e., a structure in which no coalition would reject a proposed arrangement. When projects are indivisible, stable allocations may fail to exist and, for those cases, we resort to the least core in order to estimate the degree of instability. We also examine the compatibility of stability and fairness in metric environments with indivisible projects, where we also explore the performance of well-known solutions, such as the Shapley value and the nucleolus.

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File URL: http://www.upo.es/serv/bib/wps/econ1016.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by Universidad Pablo de Olavide, Department of Economics in its series Working Papers with number 10.16.

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Length: 44 pages
Date of creation: Dec 2010
Date of revision:
Handle: RePEc:pab:wpaper:10.16

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Keywords: Stability; Fairness; Membership; Coalition Formation;

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  1. Jens Leth Hougaard & Lars Thorlund-Petersen & Bezalel Peleg, 2001. "On the set of Lorenz-maximal imputations in the core of a balanced game," International Journal of Game Theory, Springer, vol. 30(2), pages 147-165.
  2. repec:ulb:ulbeco:2013/6500 is not listed on IDEAS
  3. Alberto Alesina & Ignazio Angeloni & Federico Etro, 2003. "International Unions," Harvard Institute of Economic Research Working Papers 2001, Harvard - Institute of Economic Research.
  4. Winfried Pohlmeier & Luc Bauwens & David Veredas, 2007. "High frequency financial econometrics. Recent developments," ULB Institutional Repository 2013/136223, ULB -- Universite Libre de Bruxelles.
  5. Alexei Savvateev & Jacques Drèze & Michel Le Breton & Shlomo Weber, 2007. "“Almost” Subsidy-free Spatial Pricing in a Multi-dimensional Setting," Working Papers 2007.68, Fondazione Eni Enrico Mattei.
  6. Javier Arin & Elena Inarra, 2001. "Egalitarian solutions in the core," International Journal of Game Theory, Springer, vol. 30(2), pages 187-193.
  7. Belleflamme,Paul & Peitz,Martin, 2010. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9780521681599.
  8. Montero, Maria, 2006. "Noncooperative foundations of the nucleolus in majority games," Games and Economic Behavior, Elsevier, vol. 54(2), pages 380-397, February.
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