Ruhr Economic Papers
Ruhr Economic Papers #212
The Core of an Extended Tree Game: A New Characterisation
by Barbara von Schnurbein
University of Duisburg-Essen, 11/2010, 22 S./p., 8 Euro, ISBN 978-3-86788-245-3download
Cost allocation problems on networks can be interpreted as cooperative games on a graph structure. In the classical standard tree game, the cost of a service delivered, by a source has to be allocated between homogeneous users at the vertices. But, modern networks have also the capacity to supply different (levels of) services. For example, a cable network that provides diff erent television standards. Users that choose different levels of service can not be treated equally. The extended tree game accounts for such differences between users. Here, players are characterised by their level of demand, consequently the implications on the cost structure of the problem can be considered. We show how an ET-game can be formulated as the sum of unanimity games. This observation enables us to directly calculate the weighted Shapley values and to identify the core of an ET-game.
JEL-Classification: C71, C44
Keywords: Cooperative game theory; extended tree game; core