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Stable and efficient coalitional networks

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  • CAULIER, Jean-François

    () (CES, Université Paris 1 Panthéon-Sorbonne, F-75647 Paris, France)

  • MAULEON, Ana

    () (CEREC, Facultés universitaires Saint-Louis, B-1000 Brussels, Belgium and Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium)

  • SEMPERE-MONERRIS, José J.

    () (Department of Economic Analysis and ERI-CES, Universidad de Valencia, E-46022 Valencia, Spain and Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium)

  • VANNETELBOSCH, Vincent

    () (Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium)

Abstract

We develop a theoretical framework that allows us to study which bilateral links and coalition structures are going to emerge at equilibrium. We define the notion of coalitional network to represent a network and a coalition structure, where the network specifies the nature of the relationship each individual has with her coalition members and with individuals outside her coalition. To predict the coalitional networks that are going to emerge at equilibrium we propose the concepts of strong stability and of contractual stability. Contractual stability imposes that any change made to the coalitional network needs the consent of both the deviating players and their original coalition partners. Requiring the consent of coalition members under the simple majority or unanimity decision rule may help to reconcile stability and effiency. Moreover, this new framework can provide in- sights that one cannot obtain if coalition formation and network formation are tackled separately and independently.

Suggested Citation

  • CAULIER, Jean-François & MAULEON, Ana & SEMPERE-MONERRIS, José J. & VANNETELBOSCH, Vincent, 2011. "Stable and efficient coalitional networks," CORE Discussion Papers 2011039, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  • Handle: RePEc:cor:louvco:2011039
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    References listed on IDEAS

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    Cited by:

    1. Caulier, Jean-François & Mauleon, Ana & Vannetelbosch, Vincent, 2015. "Allocation rules for coalitional network games," Mathematical Social Sciences, Elsevier, pages 80-88.
    2. Christophe Bravard & Sudipta Sarangi & ANA MAULEON & JOSE J. SEMPERE-MONERRIS & VINCENT VANNETELBOSCH, 2016. "Contractually Stable Alliances," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 18(2), pages 212-225, April.

    More about this item

    Keywords

    networks; coalition structures; stability; efficiency;

    JEL classification:

    • A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General

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