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Traffic routing oligopoly

Author

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  • Dávid Csercsik

    ()

  • Balázs Sziklai

    ()

Abstract

The purpose of this paper is to introduce a novel family of transferable utility games related to congested networks. We assume that players are traffic coordinators, who explicitly route their deliveries in the network. The costs of the players are determined by the total latency of the deliveries, which in turn can be calculated by the edge latency functions. Since the edge latency functions assign a latency value to the total flow on the corresponding edge, as cooperating players redesign their routing in order to minimize their overall cost, outsiders will be affected as well. This gives rise to externalities therefore the resulting game is described in partition function form. We show that cooperation may imply both negative and positive externalities in the defined game. We assume that coalitions may determine their routing according to different predictive strategies. We show that the increasing order of predictive strategies may converge to a Nash equilibrium (NE), although convergence is not guaranteed, even if a unique NE exists. Furthermore we analyze the superadditivity and stability properties of the game, and show that subadditivity may arise and the recursive core may be empty if the latency functions are not monotone or not continuous. Copyright Springer-Verlag Berlin Heidelberg 2015

Suggested Citation

  • Dávid Csercsik & Balázs Sziklai, 2015. "Traffic routing oligopoly," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 23(4), pages 743-762, December.
  • Handle: RePEc:spr:cejnor:v:23:y:2015:i:4:p:743-762
    DOI: 10.1007/s10100-013-0316-5
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    File URL: http://hdl.handle.net/10.1007/s10100-013-0316-5
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    References listed on IDEAS

    as
    1. Grabisch, Michel & Funaki, Yukihiko, 2012. "A coalition formation value for games in partition function form," European Journal of Operational Research, Elsevier, vol. 221(1), pages 175-185.
    2. Kóczy, László Á., 2009. "Sequential coalition formation and the core in the presence of externalities," Games and Economic Behavior, Elsevier, vol. 66(1), pages 559-565, May.
    3. László Kóczy, 2007. "A recursive core for partition function form games," Theory and Decision, Springer, vol. 63(1), pages 41-51, August.
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    Cited by:

    1. László Á. Kóczy, 2018. "Partition Function Form Games," Theory and Decision Library C, Springer, number 978-3-319-69841-0, September.
    2. Dávid Csercsik & Sándor Imre, 2017. "Cooperation and coalitional stability in decentralized wireless networks," Telecommunication Systems: Modelling, Analysis, Design and Management, Springer, vol. 64(4), pages 571-584, April.

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