A Generalization of the Harsanyi NTU Value to Games with Incomplete Information

Andrés Salamanca Lugo ()

No 5/2018, Discussion Papers on Economics from University of Southern Denmark, Department of Economics

Abstract: In this paper, we introduce a solution concept generalizing the Harsanyi non-transferable utility (NTU) value to cooperative games with incomplete information. The so-defined S-solution is characterized by virtual utility scales that extend the Harsanyi-Shapley fictitious weighted utility transfer procedure. We construct a three-player cooperative game in which Myerson’s [Cooperative games with incomplete information. Int. J. Game Theory, 13, 1984, pp. 69-96] generalization of the Shapley NTU value does not capture some “negative” externality generated by the adverse selection. However, when we explicitly compute the S-solution in this game, it turns out that it prescribes a more intuitive outcome which takes into account the above mentioned informational externality.

Keywords: Cooperative games; incomplete information; virtual utility (search for similar items in EconPapers)
JEL-codes: C71 C78 D82 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2018-11-25
New Economics Papers: this item is included in nep-gth, nep-hpe, nep-mic and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: A generalization of the Harsanyi NTU value to games with incomplete information (2020)
Working Paper: A Generalization of the Harsanyi NTU Value to Games with Incomplete Information (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:sdueko:2018_005

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