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Economic Theory

, Volume 39, Issue 2, pp 307–330 | Cite as

Implementing cooperative solution concepts: a generalized bidding approach

  • Yuan Ju
  • David Wettstein
Research Article

Abstract

This paper provides a framework for implementing and comparing several solution concepts for transferable utility cooperative games. We construct bidding mechanisms where players bid for the role of the proposer. The mechanisms differ in the power awarded to the proposer. The Shapley, consensus and equal surplus values are implemented in subgame perfect equilibrium outcomes as power shifts away from the proposer to the rest of the players. Moreover, an alternative informational structure where these solution concepts can be implemented without imposing any conditions of the transferable utility game is discussed as well.

Keywords

Implementation Bidding mechanism Shapley value Consensus value Equal surplus value 

JEL Classification

C71 C72 D62 

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Copyright information

© Springer-Verlag 2008

Authors and Affiliations

  1. 1.Department of Economics and Related StudiesUniversity of YorkHeslington, YorkUK
  2. 2.Extramural fellow of CentER for Economic ResearchTilburg UniversityTilburgThe Netherlands
  3. 3.Department of EconomicsBen-Gurion University of the NegevBeer-ShevaIsrael

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