Independence of dummy units and Shapley-Shubik methods in cost sharing problems with technological cooperation
AbstractIn the discrete cost sharing model with technological cooperation (Bahel and Trudeau (IJGT, 2013)), we study the implications of a number of properties that strengthen the well-known Dummy axiom. Our main axiom, which requires that costless units of demands do not affect the cost shares, is used to characterize two classes of rules. Combined with anonymity and a specific stability property, this requirement picks up sharing methods that allow the full compensation of at most one technological contribution. If instead we strengthen the well-known Dummy property to include agents whose technological contribution is offset by the cost of their demand, we are left with an adaptation of the Shapley-Shubik method that treats technologies as private and rewards their contributions. Our results provide two interesting axiomatizations for the adaptations of the Shapley-Shubik rule to our framework.
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Bibliographic InfoPaper provided by University of Windsor, Department of Economics in its series Working Papers with number 1304.
Length: 20 pages
Date of creation: Jun 2013
Date of revision:
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Shapley-Shubik; Technological Cooperation; Dummy;
Find related papers by JEL classification:
- C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
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