FEEM working papers "Note di lavoro" series
2003 .094

The Gamma-Core and Coalition Formation


Authors: Parkash Chander
Series: Climate Change and Sustainable Development
Editor: Carlo Carraro
Type: Journal
Keywords: Core,Characteristic function,Strategic games,Coalition formation
JEL n.: C71,C72,D62
JEL: International Journal of Game Theory
Pages: Vol. 35, No. 4, pp. 539-556
Date: 2007

Abstract

This paper reinterprets the ã -core (Chander and Tulkens (1995, 1997)) and justifies it as    well as its prediction that the efficient coalition structure is stable in terms of the coalition formation theory. It is assumed that coalitions can freely merge or break apart, are farsighted (that is, it is the final and not the immediate payoffs that matter to the coalitions) and a coalition may deviate if and only if it stands to gain from it. It is then shown that subsequent to a deviation by a coalition, the nonmembers will have incentives to break apart into singletons, as is assumed in the definition of the ã - characteristic function, and that the grand coalition is the only stable coalition structure.

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