Marginal contributions and externalities in the value

Geoffroy de Clippel () and Roberto Serrano ()

No 2007-04, Working Papers from Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales

Abstract: Our concern is the extension of the theory of the Shapley value to games with externalities. Using the standard axiom systems behind the Shapley value for an arbitrary exogenous coalition structure leads to the identification of bounds on players’ payoffs around an \"externality-free\" value. In endogenizing the coalition structure, we analyze a two-stage process of coalition formation in whose second stage our axiomatic results are applied. We find reasons to explain inefficient coalition structures, and provide sufficient conditions for efficiency.

Keywords: externalities; marginal contributions; Shapley value; Pigouvian transfers; coalition formation (search for similar items in EconPapers)
JEL-codes: C7 D62 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-gth and nep-net
Date: 2007-02-28
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Published in Econometrica 76(6), November 2008: 1413-1436

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Related works:
Working Paper: MARGINAL CONTRIBUTIONS AND EXTERNALITIES IN THE VALUE (2005)
Working Paper: Marginal Contributions and Externalities in the Value (2005)
Journal Article: Marginal Contributions and Externalities in the Value (2008)
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Persistent link: http://EconPapers.repec.org/RePEc:imd:wpaper:wp2007-04

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