nep-gth New Economics Papers
on Game Theory
Issue of 2005‒11‒09
six papers chosen by
László Á. Kóczy
Universiteit Maastricht

  1. On the Shapley value of a minimum cost spanning tree problem By Gustavo Bergantiños; Juan Vidal-Puga
  2. Minimum Norm Solutions for Cooperative Games By Klaus Kultti; Hannu Salonen
  3. Cooperation with Strategy-Dependent Uncertainty Attitude By Nicola Dimitri
  4. Dynamic Consistency in Extensive form Decision Problems By Nicola Dimitri
  5. A Double Auction Market with Signals of Varying Precision By Carl Plat
  6. A Game Theoretic Approach to Computer Science: Survey and Research Directions By Crescenzio GALLO

  1. By: Gustavo Bergantiños (Universidade de Vigo); Juan Vidal-Puga (Universidade de Vigo)
    Abstract: We associate an optimistic coalitional game with each minimum cost spanning tree problem. We define the worth of a coalition as the cost of connection assuming that the rest of the agents are already connected. We define a cost sharing rule as the Shapley value of this optimistic game. We prove that this rule coincides with a rule present in the literature under different names. We also introduce a new characterization using a property of equal contributions.
    Keywords: minimum cost spanning tree problems Shapley value
    JEL: C71
    Date: 2005–09–01
  2. By: Klaus Kultti (University of Helsinki); Hannu Salonen (University of Turku)
    Abstract: We show that to each linear solution that has the inessential game property, there is an inner product on the space of games such that the solution to each game is the best additive approximation of the game (w.r.t. the norm derived from this inner product). If the space of games has an inner product, then the function that to each game assigns the best additive approximation of this game (w.r.t. the norm derived from this inner product) is a linear solution that has the inessential game property. Both claims remain valid also if solutions are required to be efficient.
    Keywords: transferable utility, cooperative games, additive solutions
    JEL: C7
    Date: 2005–08–11
  3. By: Nicola Dimitri
    Abstract: The paper shows that in a Prisoner’s Dilemma Knightian uncertainty, formalised by multiple priors, may entail cooperation at a generalised Nash Equilibrium. The main idea is that players may have an attitude towards uncertainty that depends upon their available strategies. In particular, if players anticipate to be sufficiently more optimistic when choosing to cooperate, than when defecting, then they may indeed cooperate. Though uncommon in economic modelling, choice-dependent uncertainty attitude formalises a behaviour which is well understood and widely accepted by cognitive psychologists, within the theory of Cognitive Dissonance.
    Keywords: Cooperation, Cognitive Dissonance, Equilibrium, Games, Uncertainty
    JEL: C72
    Date: 2005–07
  4. By: Nicola Dimitri
    Abstract: In a stimulating paper Piccione and Rubinstein (1997) argued how a decision maker could undertake dynamically inconsistent choices when, in an extensive form decision problem, she exhibits a particular type of imperfect recall named absentmindedness. Such imperfection obtains whenever an information set includes histories along the same decision path. Starting from work focusing on the Absentminded Driver example, and independently developed by Segal (2000) and Dimitri (1999), the main theorem of this paper provides a general result of dynamically consistent choices, valid for a large class of finite extensive form decision problems without nature.
    JEL: C72
    Date: 2005–07
  5. By: Carl Plat
    Abstract: A computerized double auction market with human traders is employed to examine the relation of price and volume under conditions of asymmetric information. In this market, the informed traders receive higher precision signals than the uninformed traders. The relation of price and volume has been suggested as an important factor in the process of information revelation whereby information held by informed traders is transferred to uninformed traders. In contrast, the no-trade theorems suggest that trade should not occur at all between informed and uninformed traders. The results show trading volume within the informed group to be positively correlated with signal precision. In situations of asymmetric information, uninformed trading activity as measured by volume/precision correlations declines significantly as the precision of the signals of informed traders increases. However, the presence of asymmetric information does not lead to a zero trade condition for either the informed or the uninformed traders.
    Keywords: Experimental, Double Auction, Information Precision, Trading Volume, Asymmetric Information
    JEL: C92 G12 G14 D8
    Date: 2005–08–26
  6. By: Crescenzio GALLO (Università di Foggia-Dipartimento di Scienze Economiche, Matematiche e Statistiche)
    Abstract: Theoretical Computer Science classically aimed to develop a mathematical understanding of capabilities and limits of traditional computing architecture (Boole, von Neuman, Turing, Church, Godel), investigating in computability, complexity theory and algorithmics. Now it seems more natural to revisit classical computer science notions under a new game- theoretic model. The purpose of this work is to investigate some themes at the intersection of algorithmics and game theory, emphasizing both mathematical and technological issues.
    Keywords: computer science, game theory, network, protocol
    JEL: C7 D8
    Date: 2005–09–07

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