Multiplayer Allocations in the Presence of Diminishing Marginal Contributions: Cooperative Game Analysis and Applications in Management Science

Mingming Leng (), Chunlin Luo () and Liping Liang ()
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Mingming Leng: Faculty of Business, Lingnan University, Hong Kong
Chunlin Luo: School of Information Management, Jiangxi University of Finance and Economics, Nanchang 330013, China
Liping Liang: Faculty of Business, Lingnan University, Hong Kong

Management Science, 2021, vol. 67, issue 5, 2891-2903

Abstract: We use cooperative game theory to investigate multiplayer allocation problems under the almost diminishing marginal contributions (ADMC) property. This property indicates that a player’s marginal contribution to a non-empty coalition decreases as the size of the coalition increases. We develop ADMC games for such problems and derive a necessary and sufficient condition for the non-emptiness of the core. When the core is non-empty, at least one extreme point exists, and the maximum number of extreme points is the total number of players. The Shapley value may not be in the core, which depends on the gap of each coalition. A player can receive a higher allocation based on the Shapley value in the core than based on the nucleolus, if the gap of the player is no greater than the gap of the complementary coalition. We also investigate the least core value for ADMC games with an empty core. To illustrate the applications of our results, we analyze a code-sharing game, a group buying game, and a scheduling profit game.

Keywords: coalitional games; diminishing marginal contributions; the core; the nucleolus; the Shapley value (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:67:y:2021:i:5:p:2891-2903

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