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Stationary consistent equilibrium coalition structures constitute the recursive core

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  • László Á. Kóczy

    () (Keleti Faculty of Economics, Budapest Tech and Department of Economics, Maastricht University)

Abstract

We study coalitional games where the proceeds from cooperation depend on the entire coalition structure. The coalition structure core (Kóczy, GEB, 2007) is a generalisation of the coalition structure core for such games. We introduce a noncooperative, sequential coalition formation model and show that the set of equilibrium outcomes coincides with the recursive core. In order to extend past results to games that are not totally balanced (understood in this special setting) we introduce subgame-consistency that requires perfectness in relevant subgames only, while subgames that are never reached are ignored.

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File URL: http://uni-obuda.hu/users/vecseya/RePEc/pkk/wpaper/0905.pdf
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Bibliographic Info

Paper provided by Óbuda University, Keleti Faculty of Business and Management in its series Working Paper Series with number 0905.

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Length: 20 pages
Date of creation: Aug 2009
Date of revision:
Handle: RePEc:pkk:wpaper:0905

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Keywords: partition function; externalities; implementation; recursive core; stationary perfect equilibrium; time consistent equi- librium;

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  1. Perry, M. & Rany, P., 1992. "A Non-Cooperative View of Coalition Formation and the Core," UWO Department of Economics Working Papers 9203, University of Western Ontario, Department of Economics.
  2. Chen Ying Huang & Tomas Sjostrom, 2005. "Implementation of the Recursive Core for Partition Function Form Games," Economics Working Papers 0052, Institute for Advanced Study, School of Social Science.
  3. Ray, Debraj, 2007. "A Game-Theoretic Perspective on Coalition Formation," OUP Catalogue, Oxford University Press, number 9780199207954, September.
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  9. László Á. Kóczy, 2006. "Sequential coalition formation and the core in the presence of externalities," Working Paper Series 0801, Óbuda University, Keleti Faculty of Business and Management, revised Apr 2008.
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  19. Asilis, Carlos M., 1995. "A note on the equivalence of time consistency and subgame perfection in stochastic games," European Economic Review, Elsevier, vol. 39(2), pages 245-251, February.
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