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Stable partitions for games with non-transferable utilities and externalities

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  • Dominik Karos

Abstract

We provide a model of coalitional bargaining with claims in order to solve games with non-transferable utilities and externalities. We show that, for each such game, payoff configurations exist which will not be renegoiated. In the original game derived from these payoff configurations, we can find a partition in which no group of players has an incentive to jointly change their coalitions. For games without externalities this partition and the corrresponding payoffs constitute a strong Nash equilirium in a strategic form game with complete information. We use our model to provide a common framework for a variety of solutions for cooperative games, bargaining problems and bankruptcy problems.

Suggested Citation

  • Dominik Karos, 2015. "Stable partitions for games with non-transferable utilities and externalities," Economics Series Working Papers 741, University of Oxford, Department of Economics.
    • Handle: RePEc:oxf:wpaper:741
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    References listed on IDEAS

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    1. Dominik Karos, 2016. "Stable partitions for games with non-transferable utility and externalities," International Journal of Game Theory, Springer;Game Theory Society, vol. 45(4), pages 817-838, November.

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    More about this item

    Keywords

    Games with non-transferable utilities in partition function form; Bargaining with claims; Ordinal games; Core stable partitions; Non-cooperative coalition formation;
    All these keywords.

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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