| By: |
Eyckmans, Johan (Hogeschool-Universiteit Brussel (HUB), Belgium);
Finus, Michael (University of Exeter Business School,UK);
Mallozzi, Lina (University of Naples Federico II, Italy) |
| Abstract: |
We propose a class of sharing rules for the distribution of the gains from
cooperation for partition function games with externalities. We show that this
class of sharing rules is characterized by three axioms: coalitional
efficiency, additivity and anonimity which are adapted to the context of
partition function games. The sharing rules stabilize, in the sense of
d'Aspremont et al. (1983), the coalition which generates the highest global
welfare among the set of potentially internally stable coalitions. The new
class of sharing rules is particularly powerful for economic problems that are
characterized by positive externalities from coalition formation (outsiders
benefit from the expansion of the coalition) and which therefore often suffer
from free-riding. |
| Keywords: |
partition function; coalition formation; externalities; surplus |
| JEL: |
C70 C71 |
| Date: |
2011–07 |
| URL: |
http://d.repec.org/n?u=RePEc:hub:wpecon:201108&r=net |