, Volume 23, Issue 2, pp 277-284

Stabilization through taxation inn-person games

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Abstract

In formulating solutions forn-person cooperative games, the concept of stability has played a dominant role. Although the core concept has the strongest stability, the core of a game is often empty. In this paper, the taxation system is incorporated into our framework, so that a modified solution concept, which enjoys the stability of core, can be developed. Various formulations based on principles such astaxation proportional to income andequity after tax are given.

Communicated by G. Leitmann